Plan limit rejections are intended to help control costs, provide clinical edits, and assist pharmacies in ensuring patient safety. When you bill a claim for the calculated days’ supply [based on the quantity and directions] and receive a rejection, you must identify and address the underlying rejection message. Paying attention to these rejection messages is key to avoiding audit recoupments. Here are a few examples:
- “Exceeds maximum daily dose, prior authorization required”
Prescription: Insulin Aspart FlexPen, 45 mL
Sig: Inject 40 units before breakfast, lunch, and supper plus correction scale. Max daily dose of 185 units.
Days’ Supply Calculation: 4500 units/185 units per day = 24 days’ supply
Initial Rejection with accurate days’ supply: “Exceeds maximum daily dose, prior authorization required”
Pharmacy Action: Rebilled the days’ supply for 30.
Audit Discrepancy: The claim was flagged as an incorrect days’ supply indicating a prior authorization (PA) is required for the dose prescribed
Potential Recoupment: full claim amount
Recommended Action Upon Initial Rejection: pursue prior authorization. Most limits are based on typical clinical use and/or FDA approved dosing.
Prescription: Oxycontin 80 mg, #90 tablets
Sig: One tablet three times a day
Days’ Supply Calculation: 90 tablets/3 tablets per day = 30 days’ supply
Initial Rejection with accurate days’ supply: “Plan limit exceeded. Maximum two tablets per day.”
Pharmacy Action: Rebilled the claim for #60 for 30 days
Audit Discrepancy: The claim was flagged as an incorrect days’ supply indicating a prior authorization (PA) is required for the dose prescribed
Potential Recoupment: full claim amount
Recommended Action Upon Initial Rejection: pursue prior authorization. Bypassing these edits for opioids can lead to overdoses or diversion. Especially for controlled substances, pharmacists have a corresponding responsibility to ensure that prescriptions are for a legitimate medical purpose 21 CFR 1306.04(a). The prescriber should obtain a prior authorization, change the dose or prescribe an alternative medication.
While we have recently seen OptumRx® be more aggressive with pharmacies “willfully” bypassing plan limits, all PBMs can easily identify when a claim rejected and was then immediately rebilled for the same quantity but different days’ supply or different quantity but same days’ supply (i.e., the quantity/day ratio change from the initial adjudication to a subsequent adjudication). This raises a red flag and is an easy audit target for PBMs.
PAAS Tips:
- Always bill for the accurate days’ supply based on the quantity and the directions given on the prescription
- Educate all pharmacy staff to identify rejection messages, how to properly resolve them, and avoid inputting an incorrect days’ supply or quantity to get a paid claim
- Check with the PBM help desk for guidance on rejects that are vague or unclear
- Do not split bill rejected claims
- Charging the patient cash often leads to complaints (from the patient to an employer or PBM) and can be considered non-compliance with the provider manual and lead to remediation, cease and desist letters, or even network termination
- If you have exhausted all plan options (including pursuing a PA or alternative therapy) and the patient insists on paying cash for the full prescription, be sure that you document authorization from the patient that they desired to pay the full cost and did not want to wait for the proper channels, and they will not seek reimbursement from the insurance
- If the prescriber does not follow through on obtaining a PA, enlist the patient to help. The patient could contact the prescriber and/or file a complaint with their insurance which may speed up the process
- See the following Newsline articles for more information on claim rejections
Understanding the Medicare Prescription Payment Plan (MPPP or M3P): What You Need to Know
As part of the Inflation Reduction Act, all Medicare prescription drug plans (Medicare Part D plans) – including both standalone Medicare prescription drug plans and Medicare Advantage (MA) plans with prescription drug coverage – will be required to offer the Medicare Prescription Payment Plans (MPPP or M3P). This option allows patients to manage their copays and deductibles evenly throughout the year, benefiting those facing high drug costs early in the year. While participation is optional, enrolled patients will have a $0 copay at the pharmacy and will receive a monthly bill from their Part D or Advantage Plan, which features 0% interest and no fees. Patients can choose to enroll or opt out of the program at any time. Enrollment can be completed via phone, mail, or website of their selected Medicare Plan Sponsor. However, if patients fail to pay their bill by the end of the grace period (typically 60 days), they may be automatically opted out. It’s important to note that pharmacies are not responsible for enrolling patients or collecting payments on an M3P bill (nor are pharmacies able to enroll patients).
Starting January 1, 2025, if a prescription copay for a Medicare beneficiary exceeds $600, Plan Sponsors (via CMS directive) will require the pharmacy to provide the patient with the standard “Likely to Benefit” Notice (CMS Form 10882). The notification to issue this notice will be sent as an online adjudication response Approved Message Code 056 from the PBM, indicating that the patient is “likely to benefit” from the M3P. Since the patient needs to contact the plan to enroll, it won’t happen real time at the pharmacy counter. If the patient wants to opt in prior to picking up the prescriptions, they will need to return to the pharmacy at a later time once they have successfully enrolled. Once enrolled, all unsold prescriptions should be reversed and reprocessed to the Part D/MA plan, any secondary payor and then the M3P (i.e., the date of service should be the same for the Part D claim, any secondary payor [when applicable] and the M3P transaction). Prescriptions that were sold before opting in does not need to be submitted to the M3P processor, as the patient has already paid the copay.
If the patient has already opted in but does not have their M3P plan information, pharmacies can retrieve the necessary processing details by adjudicating a claim and checking for Approval Message Code 057. CMS mandates that all PCNs for M3P begin with “MPPP”. Paid claim responses will include M3P processing details in the “Coordination of Benefits/Other Payors” segment of the claim information. Note the M3P processing information will not be found in the E1 eligibility response.
Other things to know:
PAAS Tips:
Reap the Benefits of the PAAS National® Newsline Archive
Did you know that you can save time by searching past Newsline articles to find answers to your common questions? In fact, the Newsline archive offers articles going back to 2016! The search feature makes it simple to find that one article you know you read a while ago, but can’t seem to remember what it said.
When using the PAAS eNewsline on the Member Portal, you are able to search the Newsline Archive by date or by using a keyword. All the articles with that keyword will pop up for you. This is a convenient feature when looking for a quick answer to your question!
Some of the top Newsline articles used by PAAS analysts to answer questions are:
Try it out by looking up any keyword or you can try these below:
You can always contact us for assistance on using the Newsline search feature.
PAAS Tips:
Adjusting Quantity or Days’ Supply Disproportionately Will Cost You!
PAAS National® wants to emphasize the importance of submitting the correct days’ supply on claims. We see many audit results that could have been avoided had the pharmacy addressed the initial rejection and not bypassed the plan limit. A prevention strategy is important because these discrepancies are often difficult to appeal successfully. Pharmacy employees should be taught that a paid claim [at adjudication] may not remain paid [upon audit] and is no substitute for a claim that is billed accurately.
Plan limit rejections are intended to help control costs, provide clinical edits, and assist pharmacies in ensuring patient safety. When you bill a claim for the calculated days’ supply [based on the quantity and directions] and receive a rejection, you must identify and address the underlying rejection message. Paying attention to these rejection messages is key to avoiding audit recoupments. Here are a few examples:
Prescription: Insulin Aspart FlexPen, 45 mL
Sig: Inject 40 units before breakfast, lunch, and supper plus correction scale. Max daily dose of 185 units.
Days’ Supply Calculation: 4500 units/185 units per day = 24 days’ supply
Initial Rejection with accurate days’ supply: “Exceeds maximum daily dose, prior authorization required”
Pharmacy Action: Rebilled the days’ supply for 30.
Audit Discrepancy: The claim was flagged as an incorrect days’ supply indicating a prior authorization (PA) is required for the dose prescribed
Potential Recoupment: full claim amount
Recommended Action Upon Initial Rejection: pursue prior authorization. Most limits are based on typical clinical use and/or FDA approved dosing.
Prescription: Oxycontin 80 mg, #90 tablets
Sig: One tablet three times a day
Days’ Supply Calculation: 90 tablets/3 tablets per day = 30 days’ supply
Initial Rejection with accurate days’ supply: “Plan limit exceeded. Maximum two tablets per day.”
Pharmacy Action: Rebilled the claim for #60 for 30 days
Audit Discrepancy: The claim was flagged as an incorrect days’ supply indicating a prior authorization (PA) is required for the dose prescribed
Potential Recoupment: full claim amount
Recommended Action Upon Initial Rejection: pursue prior authorization. Bypassing these edits for opioids can lead to overdoses or diversion. Especially for controlled substances, pharmacists have a corresponding responsibility to ensure that prescriptions are for a legitimate medical purpose 21 CFR 1306.04(a). The prescriber should obtain a prior authorization, change the dose or prescribe an alternative medication.
While we have recently seen OptumRx® be more aggressive with pharmacies “willfully” bypassing plan limits, all PBMs can easily identify when a claim rejected and was then immediately rebilled for the same quantity but different days’ supply or different quantity but same days’ supply (i.e., the quantity/day ratio change from the initial adjudication to a subsequent adjudication). This raises a red flag and is an easy audit target for PBMs.
PAAS Tips:
New Year, New Insurance, New Formularies!
With the new year approaching fast, many pharmacies are about to face the tedious task of getting patients’ new insurance cards (and dealing with changing formularies, copays and deductibles). As onerous as that can be, your pharmacy should consider …
the opportunity to also ensure profile accuracy when adjusting the patients’ billing information. Is the patient’s address and phone number up to date? Do they have any allergies you may not have listed? Since a pharmacy employee is already in their profile adjusting the insurance information, it may be beneficial to verify that the demographics on file are still accurate.
While it is important to have current information for purposes of patient safety and accuracy, it’s also a requirement for some PBMs. Section 10.08 of Caremark’s Provider Manual highlights this requirement for maintaining up to date Part D patient information on their profiles. Often during an on-site visit, Caremark auditors will ask to see a covered Part D patient’s profile, looking specifically for patient demographics and allergy information. While PAAS National® has not seen any significant recourse due to missing information on Part D patient profiles, consider validating these elements when updating insurance information.
New Year also means new formularies! Be cautious of incoming refills utilizing a DAW 9 as a new formulary could require the generic or a different drug entirely. PAAS suggests challenging a historical DAW 9 (by trying to bill the claim with the generic) with any new plan year, change in insurance or new prescription being authorized.
PAAS Tips:
International Crime Ring Fraudulently Bills Insurers for Over $1 Billion in Telehealth Scheme
In a fraud scheme that could be straight out of a made-for-TV movie, a U.S. citizen, acting as the ringleader in Russia, orchestrated a complex fraud using multiple accomplices. The operation defrauded private insurers by submitting fraudulent prescriptions through purported telemedicine visits.
While the Department of Justice announced charges against the defendants last November, seven defendants have now pleaded guilty. The perpetrators purchased pharmacies to leverage existing contracts with private health insurance companies across the country, leading to over $1.7 billion in fraudulent prescription claims. Over a 5-year period, call centers in the U.S. and other countries targeted beneficiaries, offering prescription medications without the required medical exams. The acquisition of brick-and-mortar pharmacies in various states, along with encrypted communications, allowed them to conceal the illicit activities.
Once acquired, new pharmacy management software systems were implemented to facilitate remote billing. Teams of international “billers” then submitted $1.7 billion in reimbursement claims from over 50 pharmacies across the US, resulting in private insurers paying over $500 million. In many cases, the beneficiaries never actually received the prescriptions.
The defendants, hailing from both the United States and Russia, are facing prison sentences ranging from 10 to 30 years, along with potential restitution of hundreds of millions. The ringleader of the operation, Brian Sutton, is currently at large in Russia.
Although this scheme was meticulously plotted and actions were woefully deliberate, the fact is auditors may approach well-meaning pharmacies with a dose of skepticism due to these “bad actors”.
Prior to this case, PAAS wrote a November 2021 Newsline article Telemedicine Audits: Are Your Prescriptions Legitimate? cautioning that telemedicine has become a prominent avenue for false claims to be submitted (see also November 2022 OIG Telehealth Fraud Concerns). Pharmacies need to have their own level of skepticism when filling and billing prescriptions that come as a result of a telemedicine visit. In addition to telemedicine fraud concerns, this case also highlights why it is important that signature logs are readily available and reflect an accurate signature of the patient. In its absence, there may be a question about whether the patient truly received their prescription. PAAS often sees PBMs reach out to patients directly to confirm that they not only requested a medication be filled, but also received it. Review our July article: Ensuring Audit Readiness: What PBMs Look For in Signature Logs and Proof of Delivery to help your pharmacy stay compliant.
Matching NDCs Help Keep the Audits at Bay
Billing the wrong NDC can correlate to potential audit issues, ranging from recoupments on claims to risking contract termination. In fact, poor performance on invoice audits due to the pharmacy billing the incorrect NDC (in relation to the NDC dispensed), is a leading reason pharmacy contracts get terminated. This issue can be mitigated by …
billing and dispensing the same NDC, down to the correct package size.
Unit-of-use packages like test strips, inhalers, and topical medications are some of the biggest culprits. PBMs flag claims for these products when the billed quantity is not divisible by the package size billed, making them low-hanging fruit to PBMs looking for recoupments. Pharmacies also need to be cautious of dispensing multiples of smaller package sizes when a larger package size is available on the market.
On desk or onsite audits where the auditor is conducting prescription reviews, recoupment for these claims can vary depending on the PBM and situation. Some scenarios might call for a partial recoupment with the PBM indicating they will pay for the correct package size. However, more precarious situations could seek full recoupment with little room for appeal. Listed below are common scenarios to be on the lookout for:
In the case of invoice audits, the auditor will be looking at the pharmacy’s invoices to ensure the exact NDC # that was billed matches what NDC # was received by the pharmacy as reflected on the wholesaler invoice. PAAS National® has many Newsline articles to help your pharmacy be prepared for an invoice audit, the most recent article being part of the Self-Audit Series.
PAAS Tips:
A New Way to Administer Epinephrine – Introducing neffy®
ARS Pharmaceuticals Operations has recently introduced neffy® 2 mg, the first and only FDA-approved needle-free way to administer epinephrine. neffy® is a nasal spray used for emergency treatment of severe allergic reactions in adult and pediatric patients who weigh at least 66 pounds (30 kg). Per DailyMed, “the recommended dosage of neffy® is one spray (2 mg) administered in one nostril. In the absence of clinical improvement or if symptoms worsen after the initial treatment, a second dose of neffy® may be administered in the same nostril with a second nasal spray starting 5 minutes after the first dose.”
PAAS Tips:
Medicare Part B Coverage of HIV PrEP
As of September 30th, 2024 there was an industry shift from billing HIV Pre-Exposure Prophylaxis therapy (PrEP) from Medicare Part D to Medicare Part B. This shift to Part B coverage falls under section 1861(ddd)(1) of the Social Security Act using the “additional preventative services” benefit.
Due to the high cost of HIV PrEP medications, it is crucial for pharmacies to …
stay informed about these changes. CMS released two helpful guidance documents: the PrEP for HIV National Coverage Determination (NCD) Technical Frequently Asked Questions for Pharmacies and the Fact Sheet: Medicare Part B Coverage of Pre-exposure Prophylaxis (PrEP) for Human Immunodeficiency Virus (HIV) Prevention. Below is a summary of the guidance provided in these two CMS documents.
First, the pharmacy must be enrolled as a Part B pharmacy supplier or as a DMEPOS supplier to bill Medicare Part B for HIV PrEP medications. If your pharmacy is not currently enrolled as a supplier, but you wish to take the steps to become enrolled, CMS recommends enrolling as a Part B pharmacy supplier since there is a “lower burden of enrollment” and revalidation does not occur as frequently for a Part B pharmacy supplier compared to a DMEPOS supplier. More information about enrollment can be found by going to the PrEP for HIV & Related Preventative Services CMS webpage and clicking on “How Do I Enroll”.
Second, pharmacies must submit a valid diagnosis code (ICD-10) on the HIV PrEP claim. Below is a table of diagnosis codes that may be appropriate.
Third, the following are expectations of the dispensing pharmacy:
Fourth, “the supply fee must be billed on the same claim as the PrEP for HIV drug”. This means, the pharmacy will bill the drug fee as well as the supply (“dispensing”) fee; both claims should be billed with the same date of service, diagnosis code, place of service, etcetera. If your pharmacy utilizes a Medicare Part B billing intermediary, the dispensing fee claim will likely be taken care of by the intermediary on behalf of the pharmacy. If the PrEP drug (e.g., cabotegravir) is being delivered to a medical practice for administration, the date of service billed should match the date of service delivered to the medical office. The medical office would then bill Medicare separately for the administration fee once they administer the medication to the patient. The date of service on the administration fee claim from the medical practice does not have to match the date of service on the pharmacy’s drug and supply fee claims.
Fifth, Medicare Part B claims must be submitted with the name and NPI number of the enrolled ordering/referring practitioner and the name and NPI of that practitioner must appear in the CMS Order and Referring dataset. Since pharmacists do not currently appear in this dataset, they are not eligible for ordering PrEP drugs for payment under Medicare Part B. Therefore, “if a pharmacist, under state scope of practice laws, furnishes counseling, injects a PrEP drug or orders PrEP, those series cannot be paid directly to the pharmacy and the drugs cannot be paid by Medicare Part B. Pharmacists may provide, when all conditions are met, service as auxiliary personnel “incident to” a physician’s or other practitioner’s service in certain settings. The incident to regulations require supervision by a physician or other practitioner, and such services would be billed by the supervising physician or practitioner.” Additional information about “incident to” services can be found under 42 CFR §§410.26 and 410.227 or visit the Incident To Services & Supplies CMS webpage.
PAAS Tips:
Forteo® Package Size Update – Are You Billing the Correct Cost?
Forteo® (teriparatide injection) is a parathyroid hormone analog (PTH 1-34) used in the treatment of osteoporosis, specifically for postmenopausal women at high risk for fractures, men with primary or hypogonadal osteoporosis, and individuals with osteoporosis associated with sustained glucocorticoid therapy. It is designed to increase bone mass and reduce fracture risk in patients who have failed or are intolerant to other osteoporosis therapies. Administered via a prefilled pen, each pen delivers 28 daily doses of 20 mcg.
In a recent update on August 23, 2024…
the FDA revised the product labeling to reflect a change in the pen’s composition from a 600 mcg/2.4 mL pen to a 560 mcg/2.24 mL pen. Despite this adjustment, the pen continues to deliver 28 subcutaneous doses, and the NCPDP billing quantity and unit still reflect the previous 2.4 mL measure.
PAAS National® has been in contact with NCPDP about this discrepancy, and has learned the following:
What does this mean for your pharmacy? You should verify how your software currently bills Forteo®. Make sure that when submitting a claim, the metric quantity aligns with what is displayed in your software system’s compendia and that the correct cost for one pen is included in your transmission. As of the time of publication of this article, the approximate wholesale accusation cost (WAC) for one pen is $4,200.
PAAS Tips:
Why the Unit of Measure Matters in Audits: A Small Factor with Big Consequences
A unit of measure (UOM) provides standards to define physical quantities. Without a UOM, a number is left open for interpretation, and while common sense often prevails for pharmacies, third-party auditors look for explicit instruction. With an ambiguous, or absent, UOM (primarily an issue with electronic prescriptions), an auditor may flag the claim as discrepant and attempt to recoup the claim.
PAAS National® regularly sees auditors claiming …
that the correct quantity cannot be determined without the proper UOM being present. To combat the discrepancy, pharmacies may need to obtain a letter from the prescriber to substantiate what the pharmacy billed was indeed the correct quantity. These letters are often difficult to obtain, especially when claims are several years old, prescribers have relocated, or your pharmacy doesn’t have a working relationship with the office.
If your pharmacy receives a prescription without a UOM, or a UOM that is ambiguous, PAAS recommends contacting the prescriber for clarification and documenting with a clinical note.
Examples:
The following table shows the medications PAAS typically sees UOM troubles with and the typical billing units that should be used:
*The “each” UOM may need to be clarified if the quantity doesn’t correspond to an “each” unit of measure (e.g., 10 each on an eye drop likely indicates 10 mL vs 10 bottles of 10 mL)
When in doubt, clarify the prescription. Do not leave the UOM interpretation to a third-party auditor who has no reason to give you the benefit of the doubt and every reason to interpret it to their advantage.
PAAS Tips: