Audit Risk: Prescriber Scope of Practice and Treating Self or Family

Everyone knows that PBMs do not perform “random” audits, nor do they select “random” claims in these audits. PBMs have sophisticated algorithms to look at thousands (if not millions) of prescription claims to find abnormalities and patterns that may be indicators of fraud, waste, or abuse. Two of the not-so-sophisticated formulas include comparing prescriber specialty to the drugs prescribed and matching last names of prescriber and patient.

In addition to having PBM audit risk …

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prescriptions written by prescribers that are outside of their designated specialty, or to treat themselves or family members, pose numerous ethical, legal and professional dilemmas and must be managed carefully. These situations may occur more frequently in small towns where there are limited prescribers.

While most states allow prescribers to write prescriptions beyond their specialty and to treat themselves or family members with non-controlled medications – the boundaries of when it is appropriate rely on professional judgement and opinions of both the prescriber who writes the prescription and the pharmacist who receives it.

The American Medical Association (AMA) states that, in general, physicians should not treat themselves or members of their own families. However, the AMA recognizes that it may be acceptable in limited circumstances such as emergency situations when no other qualified physician is available or for short-term, minor problems. The AMA outlines some of the possible concerns about professional objectivity, patient autonomy, and informed consent in its policy opinion.

When the patient is an immediate family member, the physician’s personal feelings may unduly influence his or her professional medical judgment. Or the physician may fail to probe sensitive areas when taking the medical history or to perform intimate parts of the physical examination. Physicians may feel obligated to provide care for family members despite feeling uncomfortable doing so. They may also be inclined to treat problems that are beyond their expertise or training.

Similarly, patients may feel uncomfortable receiving care from a family member. A patient may be reluctant to disclose sensitive information or undergo an intimate examination when the physician is an immediate family member. This discomfort may particularly be the case when the patient is a minor child, who may not feel free to refuse care from a parent.

PAAS Tips:

  • Most states prohibit prescribers from writing controlled substances for themselves and family members, except in emergencies.
  • Prescriptions written outside of a prescriber’s specialty pose potential risk of inappropriate or ineffective treatment due to a lack of expertise.
  • Documenting your rationale when choosing to dispense (or not to dispense) these types of prescriptions may protect you from PBM entanglements.
  • Best practices to help pharmacies navigate these complex situations:
    • Evaluate each prescription individually – take into account the diagnosis, the medication, and the availability (or lack thereof) of alternative prescribers
    • Verify your state laws with respect to non-controlled medications (self-prescribing of controlled substances is generally prohibited)
    • Have clear communication with patient and prescriber about your concerns
    • Document any communications with patient and/or prescriber on the prescription or in your pharmacy management system (helpful whether you choose to fill or not fill the prescription).
    • Coordinate alternative treatment options with patient and prescriber (if you choose to not dispense)

Nondiscrimination in Health Programs and Activities – Cultural Competency Training is a Must!

Earlier this year the Office for Civil Rights (OCR) released the 2024 Final Rule under Section 1557 of the Affordable Care Act (ACA), reestablishing many of the 2020 Finale Rule protections that were removed by the prior administration. One of the noteworthy changes (or reinstated regulations) appears in 45 CFR 92.11, which requires covered entities who receive federal funding to let patients know that language assistance services and auxiliary aids and services are available if needed. The notice is to be provided in English plus at least the 15 most common languages spoken by individuals with limited English proficiency (LEP) in the United States. In addition, the notice should be provided via alternate formats for those individuals with disabilities that require auxiliary aids in order to provide equal access to services rendered by covered entities. Despite this seemingly large undertaking, OCR is giving covered entities until July 5th, 2025 to implement this requirement plus is providing sample “Notice of Availability of Language Assistance Services and Auxiliary Aids and Services” that have already been translated.

The notice is but a fraction of the overarching theme the 2024 Final Rule carries: inequality of services provided amongst federally-funded programs is not tolerated. Covered entities must urgently become mindful of their Section 1557 obligation of providing non-discriminatory services on the basis of race, color, national origin, sex, age, or disability as this has been enforced since its inception in 2020, primarily by OCR receiving and investigating discrimination grievances.

Although it may seem as though the likelihood of being in OCR’s crosshairs for a Section 1557 violation is low, by the time covered entities receive notice of an investigation for discriminatory actions, it is too late. Be proactive with Cultural Competency training to help avoid an investigation in the first place, and demonstrate that your pharmacy is making strides to provide equivalent access to care.

Pharmacies that complete cultural competency training, and have the training documented, should ensure their NCPDP profile reflects that training. Learn more about PAAS’ Cultural Competency Training here, or contact us today to add the training to your membership.

2024 National Health Care Fraud Takedown

On June 27th the U.S. Department of Justice (DOJ) issued a press release outlining a National Health Care Fraud Enforcement Action that resulted in 193 defendants charged, including doctors, nurses and pharmacists, and over $2.75 billion in false claims. This year marked the highest numbers since 2020 and included coordinated efforts by the DOJ, US attorneys’ offices, HHS Office of Inspector General, FBI, and the DEA.

Takedowns related to prescription drugs included:

  • Illegitimate distribution of Adderall® and other controlled substance stimulants via telemedicine
  • Distribution of diverted HIV medications through gray market wholesalers
  • Medically unnecessary prescriptions for compounds and foot baths
  • Submission of claims to federal payors for drugs that were not purchased or dispensed
  • Providing kickbacks to patients to fill medically unnecessary prescriptions
  • Bribing physicians with cash and entertainment to refer prescriptions

For 15 years, PAAS National®’s FWA/HIPAA compliance program has helped educate community pharmacies on federal regulations. Coupled with audit assistance and the Newsline, PAAS serves as a guiding light, steering pharmacies away from trouble and towards compliance. The FWA program not only meets CMS’ definition (and PBM requirements) of an effective compliance program, but also helps with written Policies and Procedure for credentialing.

PAAS Tips:

For more insight into these compliance issues, PAAS Audit Assistance members can consider reading the following articles (many more articles available on our eNewsline):

The Need for Clarification on Prescription Labels

Pharmacy staff frequently receive prescriptions from prescribers that lack (or are missing) complete quantities or instructions for use. Clarifying these details before dispensing can help prevent audit discrepancies. Pharmacies must document these clarifications made with the prescriber’s office utilizing a clinical note that contains all four essential elements:

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  1. Date/time of clarification
  2. Name and title of who you spoke with
  3. What information was clarified
  4. Initials of pharmacy staff that made the call

This proactive approach not only enhances accuracy but also mitigates audit risk.

PBMs like OptumRx® and Caremark® are very particular that any clarification relating to instructions for use be included on the patient’s label. Auditors that determine information is missing from the patient label have flagged these as “misfilled” prescriptions – which can be very difficult to overturn. Pharmacy staff must be diligent in updating patient labels to include any supplemental instructions that were clarified.

Additionally, OptumRx® has been flagging prescriptions that include a numeric value at the end of the instructions. Some e-prescribing systems will drop the days’ supply value at the end of the instructions for use (e.g., Take 1 tablet daily. 90). Auditors claim they cannot accurately calculate the days’ supply based off “unclear information included in the instructions”. As time consuming (and absurd) as it may seem, auditors will only be satisfied if the pharmacy took the time to contact the prescriber’s office to clarify the directions and remove the erroneous days’ supply number at the end of the directions.

PAAS National® analysts frequently see the following items flagged on audit when the clarifying clinical note does not make it on the patient label:

  • Max daily dose for insulin prescriptions with sliding scale or titration
  • Area of use for topical medications or max number of grams per application
  • Number of meals and snacks for pancreatic enzyme prescriptions

PAAS also sees issues where the backtag or label do not reflect the entire instructions for use due to an expanded sig and limit of characters being printed.

PAAS Tips:

  • Ensure all staff know the four elements of a clinical notation
  • Clarification of instructions for use MUST be reflected on the patient label
  • Be sure clinical notations are included on the prescription, or electronic notations provided to the auditor for review
  • Self-audit prescriptions frequently to ensure patient labels include supplemental information clarified

Liraglutide Injection Marks Debut as First Authorized Generic GLP-1 Product

In late June, Teva Pharmaceuticals launched the first “generic” GLP-1 (Glucagon-Like-Peptide-1) receptor agonist in the United States, known as Liraglutide injection (6 mg/mL). This authorized generic of Victoza® is a once daily noninsulin injection approved to treat type 2 diabetes in adults and children aged 10 and older. It is also approved to reduce the risk of cardiovascular events like heart attacks and stroke in adults with type 2 diabetes and heart disease.

The FDA defines an authorized generic (AG) drug as the brand name drug that is marketed without the brand name on its label. So other than not having Victoza® on the label, Liraglutide is the exact same drug product as the brand Victoza®. An AG may be marketed by the brand name drug company or another company with the brand’s permission. While it is the same as the brand name product, companies typically choose to sell the AG at a slightly lower cost than the brand.

PAAS Tips:

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  • An AG is therapeutically equivalent to its brand name drug because it is the same drug
  • An AG is marketed under the brand name drug’s NDA (New Drug Application), therefore it is not listed in the FDA Approved Drug Products With Therapeutic Equivalence Evaluations (the Orange Book)
  • A pharmacy can substituted an AG for the brand name without the prescriber’s approval or a new prescription
  • Be alert that GLP-1 medications (originally approved to treat diabetes) are also FDA approved, marketed and prescribed for obesity under a different Trade Name and NDA
    • Saxenda® (Liraglutide) is FDA approved for obesity
    • AG Liraglutide injection is only approved to treat type 2 diabetes in adults and children aged 10 and older

2024 DMEPOS Series #6: Immunosuppressive Drugs for Transplant

Many pharmacies struggle with DMEPOS audits due to the complexity in medical billing and the onerous documentation requirements. Medicare Part B suppliers need to be able to produce all the required documentation if audited, and make sure all documentation meets Medicare Part B standards. This DMEPOS series is intended to help you understand these complexities and gather the needed documents.

Specifically, you need to demonstrate the following in case of an audit regarding immunosuppressive drugs for transplant:

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  • Standard Written Order (SWO)
  • Medical Records
    • Type of transplant must be documented (see documentation checklists in PAAS tips for full list)
    • The drugs prescribed following the transplant
    • Date and location where transplant was performed (in a Medicare approved facility)
  • Proof of Delivery
  • Proof of Refill Request and Affirmative Response
    • Required if delivered or mailed

Coverage criteria for immunosuppressive therapy:

  • The beneficiary was enrolled in Medicare Part A at the time of the transplant.
  • The beneficiary was enrolled in Medicare Part B at the time the drugs are dispensed.
  • The drugs were furnished on or after the date of discharge from the hospital following a covered organ transplant.
    • For date of service (DOS) on or after April 3, 2019 mail-order deliveries of immunosuppressive drugs may be mailed one or two days prior to a beneficiary’s anticipated date of discharge from an inpatient facility to a qualified place of service or alternate address, such as the inpatient hospital that performed the transplant or alternative location where the beneficiary is temporarily staying (such as temporary housing). The DOS on the claim must be the date of discharge.
  • The transplant was performed at a Medicare-approved facility.
  • The dosage, frequency and route of administration conform to generally accepted medical practice and is medically necessary to prevent or treat the rejection of an organ transplant.
  • If the prescribed drug is parenteral azathioprine (J7501) or methylprednisolone (J2920, J2930), medical records confirm that the medication cannot be tolerated or absorbed if taken orally and is being self-administered by the beneficiary.

PAAS Tips:

  • Immunosuppressive drugs are only covered under Part B to maintain an organ transplant that was Medicare eligible
  • The quantity of immunosuppressive drugs dispensed is limited to a 30-day supply
  • The KX modifier must be added to the claim line(s) for the immunosuppressive drug(s) only if all of the following four requirements are met:
    • The supplier has obtained from the ordering treating practitioner the specific date of the organ transplant, and
    • The supplier is retaining this documentation of the transplant in its files, and
    • The beneficiary was enrolled in Medicare Part A, at the time of the organ transplant (whether or not Medicare paid for the transplant), and
    • The transplant date precedes the date of service on the claim
  • If all coverage criteria are not met, the GY modifier must be added to the claim line(s)
  • The diagnosis code(s) that justify the need for these items must be included on the claim
  • Download PAAS’ Proof of Refill Request and Affirmative Response form under Proactive Tips on the Member Portal where you can document the required information from the beneficiary or their caregiver if the prescription is being mailed or delivered
  • Review documentation checklist for Jurisdiction A and D
  • Review documentation checklist for Jurisdiction B and C
  • Review the Immunosuppressive Drugs LCD and Policy Article
  • Review the following Newsline articles for additional information:

PAAS Audit Assistance members can search the Newsline archive for keyword “DMEPOS series” to read previous articles in this series. If you have any questions on accessing the Member Portal, or need help adding employees so they have access, please contact us at (608) 873-1342 or info@paasnational.com and our staff can assist you.

DAW 8: Documentation When the Generic is Not Available

DAW code billing on multi-source brand medications is a frequent audit target for PBMs due to their potential higher cost, change in pharmacy reimbursement, and impact on patient copays. PAAS National® recommends …

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supporting documentation be placed on any prescription billed with a DAW code (DAW 0 does not require documentation). Supporting documentation when the prescriber, patient, or insurance require the brand name medication is simple and straightforward. However, what steps should be taken when dispensing a brand name due to the generic not being available?

DAW 8 is only used in situations where the prescriber is allowing a substitution, a generic product exists, but you are unable to order it due to a market shortage. PAAS recommends documenting the date and the fact the generic is not available in the marketplace on the prescription. Ideally, take the time to capture an image from your pharmacy wholesaler’s website showing the generic product unavailability on that date and retain the image in a way it can be easily obtained for an audit (e.g., file it with the hardcopy prescription). Alternatively, you can reference the invoice number from your wholesaler showing the product was ordered but not sent due to being out of stock. An auditor may never ask for this proof, but if they do, you may struggle years later when the claim is audited.

PAAS Tips:

  • Always document the reason on the prescription any time a DAW other than 0 is used
  • When billing DAW 8, document the market shortage and ideally maintain proof from your wholesaler of the generic being out of stock (e.g., screen capture, invoice, etc)
  • For a detailed description of each DAW code, refer to DAW Codes Explained under Proactive Tips.
  • Review the April 2024 Newsline article, 2024 Self-Audit Series #2: DAW Codes for best practices when billing DAW codes

Do The Math and Avoid the Recoupment

Proper mathematical calculations are critical to billing prescriptions correctly. The action of translating directions on the prescription into a mathematical equation seems simple, but PAAS National® analysts see claims billed with incorrect days’ supply every day! Though many PBMs may not recoup for a simple days’ supply calculation error, the error itself can cause additional discrepancies on the claim, which usually do result in a financial penalty. For instance, if the pharmacy bills three 10.2 g Symbicort® 160 mcg/4.5 mcg inhalers with directions of 1 puff BID as a 90 days’ supply when it should be a 180 days’ supply, that will likely result in several discrepancies. First, an invalid days’ supply discrepancy. Second, the claim is usually flagged with an overbilled quantity discrepancy which results in a partial recoupment when the plan limit is 30 or 90 days. Third, it could cause a refill too soon penalty on the next fill which would result in a full recoupment of the subsequent claim. The penalties and subsequent recoupments can add up fast! 

For many medications, the mathematical calculation is straightforward; however, not all medications are easily calculated. Below is a table of the common days’ supply calculation pitfalls and ways to avoid them.

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Medication FormulationCommon Days’ Supply Calculation MistakesBest Practice to Avoid Days’ Supply Calculation Errors
Colonoscopy Prep KitsNon-calculable directions such as:“Use as directed”“Follow instructions provided by gastroenterology” Directions on the prescription and patient label should indicate whether a single-day regimen or a split-dose regimen is being followed so a proper days’ supply can be billed (1 or 2 days, respectively)Clarify “use as directed” instructions by contacting the prescriber’s office to update the directions to “use as directed per package labeling”, annotate the clarification with a clinical note, update the directions on the patient label, and (if audited) be sure to include a copy of the instructions found within the manufacturer’s product labeling
Eye DropsNon-calculable directions such as “Use in affected eye(s)”Forgetting to consider product beyond use dating (BUD)Ensure the prescription and patient label indicate which eye or eyes are being treatedEnsure a frequency is listed on the prescription and labelIf the patient is doing a short course, then discarding the remainder of the bottle, be sure the hardcopy and the patient label reflect the treatment duration and that they will throw away the remainder; the correct days’ supply would be the same as the treatment duration.If the patient is doing a short course but there are no directions to discard the remainder, calculate the days’ supply based on the drops/mL specified by the PBM to which the claim is being billed; refer to the PAAS Eye Drops chart for additional guidanceConsider the BUD of the eye drops, where applicableRefer to manufacturer guidance on drops/mL for unique products such as Miebo®, Veyve®, and Vyzulta®
InsulinSliding scale insulin without a max daily dose (MDD)Insulin titration to meet a specific blood glucose goal without a MDDForgetting to consider product BUDObtain a MDD for sliding scale insulin or insulin titrations to meet a blood glucose goal; document the MDD on the prescription and on the patient labelDocument priming units if used in days’ supply calculations for insulin pensConsider BUD on pens and vials 
Migraine Rescue MedicationsNon-calculable directions such as:“Use as needed”“Use as directed”No indication of whether an additional dose can be taken (after the applicable waiting period) for the same episode for qualifying medications and dosesIgnoring dosage and administration guidance from the package insert or adjudication messaging Ensure the prescription includes the amount of medication to be taken per administration and a specified frequency of administration (including the frequency of repeat dosing)Obtain the allowable number of migraines the patient can treat per week or per month, document this information on the prescription and on the patient’s label and use this information in the days’ supply calculationPay attention to dosing and administration guidance within the package insert and to the payer’s messaging upon claim adjudication to avoid audit triggers for excessive amounts billed 
Pancreatic EnzymesMissing the total number of capsules per dayMissing the number of snacks per dayThe directions on the prescription and the patient label should include either:The total number of capsules per day the patient can consumeThe number of meals and snacks per day with which the medication is takenAuditors will generally assume 3 meals/day but the number of snacks per day should be indicated on the prescription and labelRemember to account for the FDA product label update from 10/12/2023 which now requires all strengths of Creon® to be dispensed in the manufacturer’s bottle
Topicals (creams, gels, ointments, solutions) Non-calculable directions such as:“Use as directed”“Apply to affected area once daily”Santyl® ointment missing the wound length and width, missing the treatment duration, not using the Santyl® calculator, forgetting to account for inherent rounding issues with manufacturer’s online calculatorJublia® directions to “apply to toenails once daily” Ensure the hardcopy and the patient label list the grams/application or grams/day the patient is usingReview the PAAS Topical Creams and Ointments tool for guidance on the Fingertip Unit (FTU) method1 FTU = 0.5 gThe prescription must have the site(s) to which the topical is being applied and an application frequencyDocument your FTU calculation on the prescription or within the electronic prescription recordSantyl® ointment prescriptions require the wound(s) length and width (in cm) plus the treatment duration and use of the manufacturer’s online calculator or the PAAS Rx Days’ Supply Calculator AppJublia® prescriptions (and the patient label) must include the number of applications needed per day. Each toenail being treated would require one application, except each big toenail treated would require two applications. A 4 mL bottle contains approximately 200 applications.
Vaginal CreamsNon-calculable directions such as:“Use as directed”“Pea-sized amount”“One application twice weekly”Estrace® (estradiol) 0.01% vaginal cream comes in a
42.5 g tube and has a graduated applicator with measurements from 1 g to 4 g, in 1 g incrementsPremarin® (conjugated estrogens) vaginal cream comes in a 30 g tube and has a graduated applicator with measurements from 0.5 g to 2 g, in 0.5 g incrementsA “pea-sized amount” should be clarified to be an amount in grams (e.g., insert a pea-sized amount (0.25 g) vaginally twice per week)An “application” is not specific enough to calculate a days’ supply; however, “1 applicatorful” or “half an applicatorful” would be sufficient along with a frequency (e.g., insert half an applicatorful twice weekly for Estrace® would be 2 g twice per week and for Premarin® would be 1 g twice per week)

PAAS Tips:

  • A complete clinical note should include four elements:
    1. The date/time of the call
    2. The name and title of the person you spoke with at the prescriber’s office
    3. The clarification
    4. Your initials
  • Ensure the instructions on the patient label are updated to reflect any clarification made to the directions on the prescription so the patient receives the full set of instructions at the time of dispensing
  • Follow the Can You Bill It As 30 Days? (The ILQ Process) guidance when a claim billed with the correct days’ supply rejects due to plan limitations exceeded

2024 Self-Audit Series #6: Return to Stock

PAAS National® analysts continue to see pharmacies face recoupment on audits due to return to stock violations. Pharmacies argue the patient received the medication, so how can the claim be recouped? Unfortunately, each PBM contract has a specific number of days, within which, the pharmacy must dispense the medication. Dispensing outside this time frame will likely result in full recoupment of the claim if discovered upon audit.

PBM return to stock windows range from 10 – 30 calendar days. With no industry standard interval, PAAS recommends …

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pharmacies set their policy for the most conservative number of days to ensure no claims will be missed. See our Return to Stock Chart, located on our website, for the most current PBM policies.

PAAS FWA/HIPAA members can review and update their current policy, located in Section 4.1.1 Unclaimed Prescriptions, in their policy and procedure manual. Additionally, members have access to an Unclaimed Prescription Reversal Log, that can be found in Appendix B.

PAAS Tips:

  • Review your current Return to Stock policy and procedures to ensure compliance with 10 calendar days
  • Prioritize time for an assigned employee to complete this task
  • Run daily reports identifying prescriptions not picked up according to your policy; this should include completions of partially filled prescriptions due to medication out of stock issues
  • Regularly monitor oversized bins, special order areas, and refrigerators
  • Watch for out-of-stock prescriptions, claims should be billed when product is available
  • Contact your pharmacy management and/or point of sale system to see if they can program to stop sales of prescriptions that exceed your policy
    • This would allow the claim to be reprocessed with an updated fill date which would reset the return to stock timeline
  • LTC claims are not exempt from return to stock windows; the clock starts from the date billed, not the date physically filled
  • Beware of REMS prescriptions having specific restrictions for pick up, see our June 2021 Newsline article, Would Your REMS Prescription Pass an Audit?
  • Reverse and rebill any prescriptions the patient intends on picking up soon or asks you to “hold”
  • Do not have patients sign for prescriptions that were previously received, this does not provide accurate dating during audit review and can hurt your appeal options

Don’t have written compliance policy and procedures? Consider joining the PAAS National® FWA/HIPAA Compliance Program today! info@paasnational.com or (608) 873-1342.

NEW Dispense as Written (DAW) Code Revealed

Chances are you have come across a claim or two (or several thousand!) with a DAW code of 1, 2, or 9. Pharmacy staff are usually knowledgeable about when to use these DAW codes – that a DAW 1 may be appropriate to use when the prescriber does not authorize generic substitution on a multi-source brand, a DAW 2 when the patient requested the brand name, and a DAW 9 when the plan explicitly indicates the brand name product is preferred. The same DAW guidance applies for biologic reference products (e.g., Lantus®) with an interchangeable biosimilar (i.e., Semglee®).

While those three DAW scenarios are fairly straightforward, real-world claim adjudication can be a bit more complex and a single numeric DAW code may not accurately convey the true billing situation. Take for instance a patient with a commercial plan for their primary coverage and Medicaid as their secondary. Sometimes, one payor may prefer the brand while the other prefers the generic. Then what?!

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The National Council for Prescription Drug Programs (NCPDP) has added its first non-numeric DAW code. The first alpha code, DAW A, can now be found in the NCPDP Telecommunication Version D and Above Questions, Answers and Editorial Updates Version 65, updated May 2024.

DAW A is utilized on multi-payor claims (i.e., when the same prescription is processed by at least two payors) and can be used on either the claim to the primary payor or on the coordinate of benefits claim to the secondary payor. It is only used to indicate to one payor that the other payor is requiring the multi-source brand or reference product (with an interchangeable biosimilar) be dispensed.

  • A DAW 9 will be used on the claim to the payor requiring the multi-source brand/reference product to be dispensed (as long as the prescriber did not require the brand/reference product). It does not matter if this is the primary payor or secondary.
  • A DAW A should be submitted on the claim to the other payor that is not requiring the multi-source brand/reference product to be dispensed. Again, it does not matter if this is the primary payor or secondary.

Utilizing a DAW A code allows the payor that is not requiring the multi-source brand/reference product to accept the claim with the associated brand pricing rules or reject the claim as 70: Product/Service Not Covered – Plan/Benefit Exclusion.

PAAS Tips:

  • As with any DAW code other than 0, ensure there is appropriate documentation on the hardcopy or within the prescription record to indicate which plan required brand and which did not
  • The most common scenario is when Medicaid is the secondary payor and they are requiring the brand/reference product, but the primary payor is not. The pharmacy would follow these steps:
    1. Submit the claim for the generic drug using DAW 0 to primary for a paid claim with non-$0 patient copay
    2. Continue billing and submit the claim for the generic drug using DAW 0 to Medicaid (secondary)
    3. Medicaid would reject the claim as 606-Brand Drug/Specific Labeler Code Required
    4. Reverse the claim and resubmit the multi-source brand/reference product to the primary with DAW 9; they should reject with 22: M/I DAW Code and if the pharmacy would continue and bill to Medicaid (secondary), Medicaid may reject the claim as 6E: M/I Other Payor Reject Code
    5. The pharmacy would then bill the claim to primary for the multi-source brand/reference product with a DAW A (Multi-Payor Brand/Reference Product Formulary Conflict) and the primary payor should accept the claim and apply brand pricing
    6. The pharmacy would then continue to bill the multi-source brand/reference product to Medicaid as the secondary payor with DAW 9
  • Be aware of DAW A utilization and remain conscientious .
    • Watch for DAW code updates from your software vendor
    • While NCPDP billing guidance has been updated to account for this new DAW code, there may be a divergence between NCPDP standards and actual implementation by payors much like the DAW 9 versus DAW 0 situation for a multi-source brand/reference product with an interchangeable biologic in the marketplace (for more information, refer to the February 2024 Newsline article, Best Practices for DAW Billing in Pharmacies)
  • For additional DAW code descriptions and billing scenarios, review the DAW Codes Explained tool which was recently updated to include DAW A guidance
  • Confused about biologic terminology like Reference Products and Interchangeable Biosimilars? Review our February 2024 Newsline article Insulin Substitution Review: Understanding Purple Book Terminology