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.

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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.

GLP-1 Receptor Agonist Analog Name FDA Indication Goal Dose
Ozempic® semaglutide Type 2 diabetes management 0.5 mg or 1 mg weekly
Wegovy™ semaglutide Chronic weight management 2.4 mg weekly
Victoza® liraglutide Type 2 diabetes management 1.2 mg or 1.8 mg daily
Saxenda® liraglutide Chronic weight management 3 mg daily

PAAS Tips:

  • Prescribers may try to help patients get around plan exclusions for weight loss medications by prescribing Ozempic® or Victoza® at higher doses
    • FDA approved medications being used off-label like this would likely not be covered under federal programs and are subject to audit recoupment
    • Claims paid at point-of-sale do not guarantee payment
  • If a prescription is written for the Analog name, pharmacies need to confirm the diagnosis to bill the correct medication
  • These products come in multiple strengths and package sizes which would also need to be confirmed
  • Medicare Part D and Medicaid may restrict coverage of medications if the prescribed use is not for a medically accepted indication

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.

  • Caremark – Generally they mail out a paper, hardcopy of their provider manual to contracted pharmacies every other year, on even years, and amendments on odd years. An electronic copy can also be found at the bottom of the Document Library on the pharmacy provider website (log in required).
  • Express Scripts® updates their manual and posts the newest version online in the Pharmacist Resource Center (log in required) along with an itemized list of updates. Pharmacy staff can read the itemized list if they are looking for an efficient way to access and review the updates.
  • Humana – Their provider manual is publicly accessible via the Pharmacy Manuals and Forms page of their website, which affords all pharmacies quick and easy access to the relevant information.
  • OptumRx® updates their provider manual multiples times each year. The newest being Version 4.1 which was published at the being of October 2021. The provider manual for OptumRx® is publicly available under the Manuals and Guides sections of the Health Care Professionals website. However, OptumRx® does not provide a summary of changes or a quick reference guide. Below are several significant updates from recent versions of their provider manual.

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    • Contracted pharmacies must provide language interpreter services in accordance with their state’s requirements or regulations.
    • Examples of “computer records” are now included under desktop and telephone audits and investigational reviews; these examples include electronic prescriptions (new and refill authorizations) as well as electronically stored clarifications or notes.
    • Over the course of 2021 several major additions have been made to the discrepancy code list:
      • 1P and 4B – Previously, claims billed with an invalid prescriber DEA number received these codes. Now, they will be utilized for invalid NPI number as well.
      • 2L – This discrepancy has been utilized when a script was missing documentation to validate the clinical appropriateness on a claim with possible clinical issues (gender/age/drug). Now, it will also be used for “possible high dose” claims without documentation supporting the appropriateness of the dose.
      • 3B – This will be utilized on claims with missing or invalid Risk Evaluation & Mitigation Strategies (REMS) documentation. For additional REMS information, refer to the June 2021 Newsline article Would Your REMS Prescription Pass an Audit?
      • 4Q – In states where prescriptions issued by mid-level practitioners require information regarding the supervising doctor, this code will be used if the supervisor’s information is missing.

 

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PAAS Tips:

  • It is important to stay up to date on the requirements of each PBM you are contracted with
  • Becoming familiar with a PBMs pharmacy provider manual can help the pharmacy prevent recoupment when audited and remain proactive by ensuring pharmacy policies and procedures are in line with PBM requirements
  • If your pharmacy receives a PBM notification regarding a policy change, please forward the notice to PAAS National® via fax (608) 873-4009 or email info@paasnational.com

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.

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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:

  • Wholesaler ordering websites may not list products in the same NCPDP billing unit or package size
  • A similar product that has unusual billing is CellCept® Oral Suspension (and generics) that list 175 mL on the outer packaging but only delivers 160-165 mL after reconstitution. NCPDP defines billing as 160 mL.
  • If you need help determining the appropriate billing quantity or unit of measure, please contact PAAS for assistance
    • If the patient is waiting at the pharmacy, please call PAAS at (608) 873-1342
    • If the patient is coming back at a later time, you can also send a question through the PAAS Portal under Questions? Safe Filling and Billing Advice

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.

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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.

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The three additions to our chart include:

  1. Carafate® (Sucralfate) 1gm/10mL Suspension
  2. Rybelsus® 3 mg, 7 mg and 14 mg tablets
  3. Tabrecta™ 150 mg and 200 mg tablets

PAAS Tips:

  • Utilize the PAAS National® Dispense In Original Container Chart, by printing and posting the updated copy in your pharmacy
  • Consider adding special shelf tags to these medications to warn staff of their packaging requirements
  • Obtain authorization from prescribers if quantity prescribed is less than what the package size is
  • Self-audit claims that fall under these guidelines to ensure you are dispensing appropriately

Telemedicine Audits: Are Your Prescriptions Legitimate?

During the Public Health Emergency, telemedicine has become a convenient, and much more common, way for patients to communicate with their healthcare team; especially when patients and healthcare facilities are wary of in-person appointments. Unfortunately, telemedicine also continues to be an easy target for bad actors, with pharmacies being caught in the middle.

In August, Prime Therapeutics reported that telemedicine schemes contributed to a 60% increase in reported false claims during 2020. In one investigation, Prime pointed to a pharmacy’s use of “high-risk, low-value” products that allowed a pharmacy to transmit $300K in their first month of doing such business. This pharmacy was terminated from the network, reported to the Board of Pharmacy and Department of Insurance, and had funds recouped.

Another example is the DEA’s announced criminal charges in a September 17, 2021 press release against 138 defendants across 31 federal districts for alleged participation in fraud schemes including $1.1 billion in telemedicine fraud. Court documents noted that telemedicine executives paid doctors and nurse practitioners to order unnecessary equipment, tests, and pain medications either without having any patient interaction or after a simple phone call with the patient whom they had never met or saw for a medical purpose. Fraudulent claims were then submitted to Medicare and other government insurers, including for telehealth consultations that did not happen in the way they were represented to the insurers. Profits made off these schemes were found to have been spent on luxury items like yachts, vehicles, and real estate.

How does a pharmacy avoid the bad actors in telemedicine and still help their legitimate patients? Background research may be necessary to understand whether prescriptions were generated from a real patient-prescriber relationship and are medically necessary. The following items should be considered before dispensing any telemedicine prescription.

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Prescription:

  • Does the prescription conform to all state and federal laws?
  • Is the prescription a template form?
    • Is every prescription for the same drug, quantity, directions, and refills regardless of a patient’s individual treatment needs?
    • Are the drugs listed all high-cost products and/or have clinically appropriate lower cost alternatives?
    • Does the prescription include substitution cascades or overly broad substitution allowances without consultation with the prescriber needed?
    • Forms with pharmacy branding can lead to problems with patient steering/patient choice laws.
  • How many items are prescribed?
  • Why did the prescription come to your pharmacy?
    • Is this a regular patient of yours?
    • Was the patient referred to your pharmacy by the prescriber?
    • Is there an intermediary routing the prescription to you like a marketing company or a pharmacy that never fills prescriptions but only transfers them out?
  • How did the prescription come to your pharmacy?
    • Facsimile? E-prescription?
    • Transfer?
    • Email/Drop Box are red flags

Patient:

  • Is this a regular patient?
    • If not, where is their regular pharmacy?
    • Why did their prescription come to you?
  • Are you filling all the patient’s medications or just the telemedicine ones?
  • Did the patient request the medication be filled?
    • Some PBMs are requiring proof that the patient requested a medication be filled in the form of a documented conversation with the patient by the pharmacy.
  • Why is the patient utilizing telemedicine?
    • Is the patient in a rural area with little access to healthcare?
    • Is the patient being treated by a specialist not available locally?
    • Online surveys or telemarketing calls are a red flag.
  • Is there a legitimate patient/prescriber relationship?
    • Does the patient regularly see this prescriber?
    • Does the patient live in the same area where the prescriber’s office is located?
    • Would you be able to obtain medical records to validate this relationship?

Prescriber:

  • Is this the patient’s regular prescriber or healthcare system?
  • Is there a legitimate patient/prescriber relationship (see above) and could you prove it if asked?
  • Is the prescriber licensed in the state where the patient resides?
  • Is the medication prescribed within the prescriber’s scope of practice?
  • How were healthcare services provided?
    • Video chat?
    • Simple telephone call?
  • Who paid the prescriber for the telemedicine encounter/visit?
    • Patient or health plan?
    • If the pharmacy or a marketing company paid for the visit, this could be seen as an illegal kickback.

Further exemplified by the US Department of Health and Human Services-Office of Inspector General report issued October 18, 2021, 84% of Medicare beneficiaries who received telehealth services had an established relationship with the provider prior to the telehealth visit.

Finally, if your pharmacy does fill prescriptions for telemedicine, and you determine the prescriptions are legitimate, you also need to follow any state Boards of Pharmacy pertaining to mailing or delivery of prescriptions. This includes confirming if your pharmacy needs to be licensed in a state other than your own that you may be shipping medications to and within PBM contractual limits that may prohibit mailing or delivery outside a certain mile radius of your pharmacy.

LIVE WEBINAR NOV. 18: PBM FWA Trends and COVID-19 Vaccine Audit Risks

Join President of PAAS National®, Trenton Thiede, PharmD, MBA for a LIVE webinar “PBM FWA Trends and COVID-19 Vaccine Audit Risks” on November 18, 2021 from 2-2:30pm CT as he discusses:

  • Who We Are and How We Help
  • PBM Fraud, Waste and Abuse (FWA) Trends
  • COVID-19 Vaccine Audit Risks
    • Documentation Requirements
    • Additional Doses for Immunocompromised
    • Booster Doses for qualified patients
    • Medicare at-home patients
  • Pandemic related PBM waivers/concessions

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.

PREP Act Ninth Amendment – Overview and Audit Guidance for Subcutaneous REGEN-COV

The ninth amendment to the Public Readiness and Emergency Preparedness (PREP) Act was published in the Federal Register on September 14th, 2021, which granted pharmacists the authority to order and administer COVID-19 therapeutics and qualified pharmacy technicians and pharmacy interns to administer COVID-19 therapeutics under the supervision of a pharmacist. The PREP Act only covers COVID-19 therapeutics by subcutaneous, intramuscular, or oral administration—therefore, IV infusion would not be covered under this amendment.

At the time of publishing, only one COVID-19 therapeutic is available for administration under the ninth amendment of the PREP Act. The co-formulated solution, REGEN-COVTM, qualifies because it has FDA emergency use authorization (EUA) for administration via subcutaneous injection in addition to IV infusion. REGEN-COVTM contains two monoclonal antibodies (mAbs), casirivimab and imdevimab, and is authorized for the treatment of certain patients with COVID-19 and for post-exposure prophylaxis in eligible patients.1,2

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proved Use1,2 Coverage Criteria1,2,3,4 Dosage1,2,5
Treatment of COVID-19

ICD-10 Code

U07.1

 ALL MUST APPLY:

  • Mild-to-moderate COVID-19 symptoms within 10 days of onset without requiring hospitalization or oxygen supplementation due to COVID-19 (or requiring more oxygen than baseline)
  • Adult or pediatric patient (≥ 12 years old and ≥ 40 kg)
  • Positive results of direct SARS-CoV-2 viral testing
  • High risk for progressing to severe COVID-19, including hospitalization or death
 600 mg casirivimab + 600 mg imdevimab

IV infusion is preferred, but subcutaneous injection is authorized when infusion is not feasible or would delay treatment.
Post-Exposure Prophylaxis

ICD-10 Code

Z20.822

 ALL MUST APPLY:

  • Adult or pediatric patient (≥ 12 years old and

≥ 40 kg)

  • High risk for progressing to severe COVID-19, including hospitalization or death
  • Not fully vaccinated -OR- not expected to fully respond to vaccine (i.e. immunocompromised)
  • Had close contact with an infected individual per CDC criteria -OR- is at high risk for exposure to an infected individual due to infection in other individuals in same institutional setting
 INITIAL EXPOSURE

600 mg casirivimab + 600 mg imdevimab

REPEAT EXPOSURE

Patients with repeat exposure expected to last more than one month may receive additional doses once every 4 weeks for the duration of the ongoing risk

300 mg of casirivimab + 300 mg of imdevimab

1FDA EUA for REGEN-COVTM, September 9, 2021. https://www.fda.gov/media/145610/download. (Accessed September 13, 2021).

2FDA Fact Sheet for Health Care Providers EUA of REGEN-COVTM (casirivimab and imdevimab). September 2021. https://www.fda.gov/media/145611/download.  (Accessed October 12, 2021).

3NIH Anti-SARS-CoV-2 Monoclonal Antibodies Treatment Guidelines. August 4, 2021. https://www.covid19treatmentguidelines.nih.gov/therapies/anti-sars-cov-2-antibody-products/anti-sars-cov-2-monoclonal-antibodies/. (Accessed September 27, 2021).

4Close Contact per CDC criteria:  https://www.cdc.gov/coronavirus/2019-ncov/php/contact-tracing/contact-tracing-plan/appendix.html#contact. (Accessed September 29, 2021).

5REGEN-COVTM: Subcutaneous Injection Instructions for Healthcare Providers COMBATCOVID.HHS.gov. July 28, 2021. https://www.phe.gov/emergency/events/COVID19/therapeutics/Documents/REGEN-COV-SubQ-FactSheet-July2021-508.pdf?utm_medium=email&utm_source=govdelivery. (Accessed October 12, 2021).

High-Risk Conditions1,2,3
  • Older age (e.g., age ≥65 years old)
  • Obesity or being overweight (adult with BMI >25 kg/m2, or if age 12-17, BMI ≥85th percentile for age and gender based on CDC growth charts)
  • Pregnancy
  • Chronic kidney disease
  • Diabetes
  • Immunosuppressive disease or immunosuppressive treatment
  • Cardiovascular disease (including congenital heart disease or hypertension)
  • Chronic lung diseases (e.g., COPD, moderate-to-severe asthma, interstitial lung disease, cystic fibrosis, pulmonary hypertension)
  • Sickle cell disease
  • Neurodevelopmental disorders (e.g., cerebral palsy)
  • Conditions with medical complexity (e.g., genetic or metabolic syndromes and severe congenital anomalies)
  • Having a medical-related technological dependence (e.g., tracheostomy, gastrostomy, positive pressure ventilation [not related to COVID-19])
  • Other conditions/risk factors making the patient high risk for severe COVID-19 (e.g., race, ethnicity) – health care providers should consider the benefit-risk of treatment for each patient

*Additional conditions can be found on the CDC’s COVID-19 Underlying Conditions or People with Certain Medical Conditions webpage

1FDA Fact Sheet for Health Care Providers EUA of REGEN-COVTM (casirivimab and imdevimab). September 2021. https://www.fda.gov/media/145611/download.  (Accessed October 12, 2021).

2CDC. COVID-19 Underlying Medical Conditions. May 2021. https://www.cdc.gov/coronavirus/2019-ncov/hcp/clinical-care/underlyingconditions.html. (Accessed October 12, 2021).

2CDC. COVID-19 People with Certain Medical Conditions. Aug 2021. https://www.cdc.gov/coronavirus/2019-ncov/hcp/clinical-care/underlyingconditions.html. (Accessed October 13, 2021).

When billing REGEN-COVTM, request reimbursement only for the administration fee (aka incentive amount) since the therapeutic agent is provided to the pharmacy at no cost by the federal government. To bill Medicare, the pharmacy must be enrolled as a Part B provider and utilize a medical billing intermediary. For claims billed to plans other than Part B, REGEN-COVTM may or may not be covered by either the pharmacy or medical benefit and cost-sharing is possible. Based on guidance from CMS, below are the billing codes for REGEN-COVTM (NDC 61755-0039-01; 10 mL vial).

sage of casirivimab + imdevimab Medicare Benefit
Drug HCPCS Code Administration HCPCS Code Administration Code Description Incentive Amount*
600 mg + 600 mg

(1,200 mg total)

 Q0244 M0243 Outpatient initial SubQ injection and post-administration monitoring $450
600 mg + 600 mg

(1,200 mg total)

 Q0244 M0244 Home or residence initial SubQ injection and post-administration monitoring in the home or residence $750
300 mg + 300 mg

(600 mg total)

 Q0240 M0240 Outpatient subsequent repeat doses SubQ injection and post-administration monitoring $450
300 mg + 300 mg

(600 mg total)

 Q0240 M0241 Home or residence subsequent repeat doses SubQ injection and post-administration monitoring in the home or residence $750

*This rate covers the administration fee plus the minimum required 1-hour post-injection clinical observation period

PAAS Tips: 

  • Robust documentation is extremely important – be audit-ready by having all the following for each claim:
  1. A placeholder hardcopy
  2. Confirmation of the patient’s eligibility with a signed attestation (COVID-19 treatment also requires valid test results)
  3. An administration log signed and dated by the patient, pharmacist, and staff who administered the therapeutic agent

Stark Law and Anti-Kickback Violations –Indictments Handed Down for Medically Unnecessary Claims

According to a September 17, 2021 press release from the Department of Justice (DOJ), a podiatrist was indicted for defrauding Medicare and Medicaid “by prescribing and dispensing medically unnecessary foot bath medications.” The podiatrist owned a foot clinic along with several in-house pharmacies. When the doctor wrote prescriptions, which were subsequently filled at an in-house pharmacy, he benefited financially from the “drug cocktail” prescribed – the higher the price of the cocktail, the higher the profit for the podiatrist. The article explains the “cocktails included capsules, creams, and powders that were not indicated to be dissolved in water and some of which were not water soluble.” To illustrate how expensive these “medically unnecessary” prescriptions were, over one year, Medicare paid the pharmacy over $18,000 for a single patient’s claims. The podiatrist faces up to 50 years in prison for his scheme to defraud Medicare and Medicaid.

Less than a month later, on October 4, 2021, the DOJ released another statement regarding medically unnecessary foot soaks. In this case, a federal grand jury indicted a pharmacist for allegedly utilizing a marketing company to solicit prescriptions for “foot bath” medications, paying the marketing company kickbacks by providing a percentage of the profit gained off each prescription obtained through their service, knowingly filling prescription which were medically unnecessary, and knowingly filling prescriptions where a valid patient/provider relationship was not established. The pharmacist faces one count of health care fraud and three counts of violations of the Anti-Kickback Statute [42 U.S.C. § 1320a-7b(b)]. Willingly incentivizing prescribers or patients by directly or indirectly providing remuneration is a clear violation of the Anti-Kickback Statue which could result in exclusion from all Federal health care programs, criminal penalties, and monetary penalties including up to three times the amount of the kickback.

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Both cases are good reminders of the importance of the relationship between the patient, prescriber, and pharmacy as well as the medication itself and whether it is being used for a medically acceptable indication via the appropriate route of administration.

Being aware of the prescriber/pharmacy relationship is important due to the Physician Self-Referral Law, better known as the Stark Law. If a physician or a member of the physician’s immediate family has a financial relationship with a pharmacy and the prescriber refers a patient to that pharmacy, there is a potential violation of the Stark Law. The law also prohibits billing an item as a result of the prohibited referral. Additional information, including covered items or services and exceptions can be found on CMS.gov or within section 1877 of the Social Security Act (42 U.S.C. § 1395nn).

The relationship between the medication prescribed, the route of administration, and the indication for use should also be considered prior to dispensing. Claims billed under federally funded plans for prescriptions utilized for non-FDA approved indications and for administration by non-FDA approved routes (e.g., topical antifungal cream dissolved in a foot bath) may be subject to recoupment. These claims may be flagged due to lack of supporting evidence for use in Part D compendia. PAAS National® analysts continue to see enforcement of this policy.

PAAS Tips: