DMEPOS Mini-Series #8 – The Six Medicare Auditing Entities and Their Purpose

The six Medicare auditing entities are responsible for auditing records, claims and payments. While they may use different methods to conduct audits, they all aim to detect, correct, and prevent improper payments to curb fraud, waste, and abuse and protect the Medicare Trust Fund. The Medicare Program Integrity Manual contains the policies and responsibilities for the entities tasked with medical and payment review.

What is the rationale for having these auditing entities? Taxpayers and future Medicare beneficiaries benefit when Medicare payments are returned to the Medicare Trust Fund. Subsequently, these audits lower the Medicare payment error rates. On occasion, pharmacies can benefit if there are any underpayments identified during an audit, in which case those dollars will be repaid to the pharmacy.

Listed below are six Medicare contractors that conduct audits and their main objectives:

Become an audit assistance member today to continue reading this article. As a member, you’ll have access to hundreds of articles and receive our monthly proactive newsletter!

Join today!

  1. MAC – Medicare Administrative Contractor
    1. Goal is to process claims for a defined jurisdiction
    2. Reviews claims on a pre-payment and post-payment basis
    3. Identify noncompliance with coverage, coding, payment, and billing policies through data analysis
    4. Take action to prevent and address improper payments
  2. UPIC – Unified Program Integrity Contractor
    1. Goal is to investigate cases of suspected FWA
    2. Take action to recoup inappropriate Medicare payments
    3. Ensure the integrity of claims under all lines of Medicare business
  3. SMRC – Supplemental Medical Review Contractor
    1. Goal is to lower the improper payment rates by conducting nationwide medical reviews with documentation requests
  4. CERT – Comprehensive Error Rate Testing Contractor
    1. Goal is to collect documentation and perform reviews on random samples of Medicare FFS claims post-payment
    2. Determine whether claims were paid appropriately based on Medicare coverage, coding, and billing rules in place
    3. Produces the improper payment rates to the MACs who can repay underpayments and recoup overpayments
  5. RAC – Recovery Audit Contractor
    1. Goal is to identify overpayments and underpayments by conducting automated and complex reviews on a post-payment basis
      1. Automated – no medical records needed
      2. Complex – medical records required
    2. OIG – Office of Inspector General
      1. Goal is to lead efforts to fight FWA
      2. Develop and distribute resources to help the health industry comply with FWA laws
      3. Education the public about fraudulent schemes
      4. Responsible for reporting to both the Secretary of Health and Human Services (HHS) and Congress and to provide recommendations to correct FWA

PAAS Tips:

  • Be prepared with FWA policies and procedures, should you not have a compliance program in place, learn more about PAAS’ Fraud, Waste & Abuse and HIPAA Compliance program or contact our office at 608-873-1342
  • Reminder: Send your Medicare Part B audits to PAAS! info@paasnational.com or fax (608) 873-4009 and we can advise what documentation is being requested and help navigate the Medicare Part B requirements and responses to audits.

Be on the Lookout for OptumRx Unannounced Onsite Audits

Receiving a PBM onsite audit notice can be intimidating but the pharmacy typically has some time to prepare before the auditor arrives. However, are you aware that pharmacies can receive unannounced onsite visits from PBMs, FDA inspectors, DEA agents or Board of Pharmacy inspectors? Being prepared for an unannounced audit is crucial and PAAS National® wants to make sure you have the tools to be successful. PAAS has become aware that OptumRx is again performing their unannounced onsite audits, see the tips below to help you be prepared should you get an unexpected visit.

PAAS Tips:

Become an audit assistance member today to continue reading this article. As a member, you’ll have access to hundreds of articles and receive our monthly proactive newsletter!

Join today!

  • Utilize our Onsite Credentialing Guidelines resource
    • Provides a list of frequently asked questions from the PBM auditors
    • Includes references to the PAAS National® Policy and Procedure Manual for our Fraud, Waste & Abuse and HIPAA Compliance members
  • These audits typically focus on credentialing requirements and not prescription review
  • Auditors may check licenses, on-hand stock of certain medications and may ask permission to take a few photos – If you are a PAAS Vault member and have uploaded licenses to the portal, those licenses are available at your fingertips
  • Two auditors may be present, and the visit is usually about 30 minutes
  • See the OptumRx Provider Manual for more information regarding an onsite audit.
    • “Administrator or its designee shall have the right, with or without notice, at reasonable times, to access, inspect, and review on-site the facilities, licenses and credentialing documents/records of Network Pharmacy Providers and pharmacy locations applying to participate in any of Administrator’s Benefit Plans, as well as make copies of the licenses credentialing documents/records etc. maintained by pharmacy. Pharmacy agrees to cooperate with Administrator or its designee with the on-site visit and acknowledges non-cooperation with an on-site visit may result in denial or termination of network participation.”
  • See the July 2022 Newsline, Is Your Pharmacy Ready for an Unannounced Audit?

Don’t have an FWA/HIPAA Compliance Program? Contact PAAS and receive a $126 discount when you combine services with your audit assistance. Get started today? info@paasnational.com or (608) 873-1342.

Fraud, Waste, and Abuse Compliance Programs Are Not Optional

PAAS National® analysts continue to see audits requesting documentation of compliance policies and procedures. FWA Training and OIG/GSA exclusion checks are not enough to be compliant as they do not constitute a compliance program. Since 2009, PAAS’ Fraud, Waste & Abuse and HIPAA Compliance program has been designed to meet CMS’ seven core elements required to adopt and implement an effective compliance program, which include:

  1. Written Policies, Procedures and Standards of Conduct
  2. Compliance Officer, Compliance Committee and High-Level Oversight
  3. Effective Training and Education
  4. Effective Lines of Communication
  5. Well Publicized Disciplinary Standards
  6. Effective System for Routine Monitoring and Identification of Compliance Risk
  7. Procedures and System for Prompt Response to Compliance Issues

PBM Provider Agreements require pharmacies to have a compliance program that meets CMS standards, and they reserve the right to request documentation of your compliance policies and procedures.

Consider the following:

  • OptumRx Section VIII Compliance; Fraud, Waste and Abuse (FWA); General Training; Audits – “A Network Pharmacy Provider involved in providing services for Medicare Part D/Medicaid Members is responsible for implementing a program to control FWA and to facilitate compliance in the delivery of Covered Prescription Services through the Medicare/Medicaid benefits.”
  • Humana’s Compliance Policy for Contracted Healthcare Providers – The Policy explicitly states pharmacies must have a compliance program that meets the seven elements outlined by CMS, including written policies, procedures and standards of conduct.
  • PerformRx Pharmacy Compliance Attestation – PerformRx requires attestations to the following: The pharmacy has implemented and maintains a compliance program that is consistent, at minimum, with applicable federal and state requirements, including, but not limited to the standards set forth in 42 CFR §423.504(b)(4)(vi) and other Centers for Medicare & Medicaid Services (CMS) guidance set forth in the Medicare Part D Prescription Drug Benefit Manual.
  • While not public, Express Scripts and Caremark also have explicit language to require a compliance program. See Caremark’s Provider Manual, Section 10.01.06 FWA program and Express Scripts Provider Manual with regards to maintaining a compliance program in accordance with CMS requirements.

Ensure you have all your compliance bases met so you can provide proof when requested for credentialing or audit. Don’t have an FWA/HIPAA Compliance Program? Contact PAAS, info@paasnational.com or (608) 873-1342 and get started today!

On-Demand Webinar: Don’t Give PBMs a Reason to Audit (Or Terminate): Off-Label Drug Use and Compliance Requirements

On November 9, 2022 PAAS National® hosted “Don’t give PBMs a reason to audit (or terminate): Off-label drug use and compliance requirements” webinar. PAAS Audit Assistance members have access to the recorded webinar, in addition to many other tools and resources on the PAAS Member Portal.

For easy viewing, we’ve split the webinar into three separate recordings.

  1. PBM Fraud, Waste & Abuse Compliance Program Requirements
  2. Does My Pharmacy Really Need Cultural Competency Training?
  3. What are the Audit Risks for Dispensing Prescriptions Off-Label? which includes:
    • Can Ozempic® and MounjaroTM be used off-label for weight loss?

Product Substitution Best Practices

Consider a scenario where your pharmacy has been dispensing a product for years and you find that the product is being discontinued, requiring a product substitution. What steps should be taken to ensure your pharmacy is protected in case of an audit?

Most recently, this has been the case for pharmacies dispensing ProAir® HFA. Since it now has been discontinued and supplanted with ProAir RespiClick®, can the product be substituted without needing to contact the prescriber?

Become an audit assistance member today to continue reading this article. As a member, you’ll have access to hundreds of articles and receive our monthly proactive newsletter!

Join today!

Before automatically substituting, it would be wise to review a product’s therapeutic equivalence. Drugs approved under a New Drug Application (NDA), or Abbreviated New Drug Application (ANDA), will be found in the FDA Orange book and use Therapeutic Equivalency (TE) Codes to establish equivalency ratings. Biologics, on the other hand, are approved under a Biologic License Application (BLA) and will be found in the FDA Purple Book. The Purple Book does not use TE codes, but rather matching color cards and category headers to indicate biosimilars and interchangeable biosimilars.

Beyond the TE Codes (primarily used to identify generic equivalents), compare the original product’s NDA to the NDA of the product you are looking to substitute. To continue with the ProAir® example, consider the NDA of both ProAir® HFA and ProAir RespiClick®:

Since the NDA numbers do not match, it would be appropriate to obtain prescriber approval and document authorization to substitute the ProAir RespiClick® for the ProAir® HFA. When requesting the change, consider obtaining a new order to help mitigate audit risk. Substituting the RespiClick on the same Rx Number has a higher likelihood to flag for potential audit.

PAAS Tips:

LIVE WEBINAR NOVEMBER 9th – Sign Up Today!

Join President of PAAS National®, Trenton Thiede, PharmD, MBA for a LIVE webinar “Don’t give PBMs a reason to audit (or terminate): Off-label drug use and compliance requirements” on November 9, 2022 from 2:00-3:00 pm CT as he answers:

  • What are the audit risks for dispensing prescriptions off-label?
  • Can Ozempic® and MounjaroTM be used off-label for weight loss?
  • What do PBMs require for Fraud, Waste & Abuse Compliance?
  • Does my pharmacy need to complete cultural competency training?

We will allow for some Q&A at the end of the webinar. If you would like to submit questions prior to the webinar, please click here.

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.

Medication Synchronization: Possible Concerns

Medication synchronization programs have many benefits for community pharmacies (and your patients) – improved workflow of your team, leaner “just in time’ inventory replenishment and fewer patient trips to the pharmacy.

Unfortunately, medication synchronization also poses a threat of waste or abuse if it goes off the rails. PAAS National® analysts have noticed PBMs auditing for refills of high-cost maintenance medications that seem to be filled especially early every month (e.g., every 23 days on a 30 days’ supply) – remember that PBM audit algorithms are looking for FWA conducted by bad actors and will use data analysis as a reason to audit your pharmacy if the claims look suspicious.

Most independent pharmacies can tell numerous stories about patients bringing in large quantities of unwanted or unused medications that they received from a PBM mail-order pharmacy because the refills just kept coming. In fact, Express Scripts was named in a recently unsealed False Claims Act lawsuit from 2019 due to automatic refills of medications for TRICARE beneficiaries. The complaint states that Express Scripts set up 90-day supply medications for refill on day 60 (of 90) which represented only 67% utilization. Over time these early refills accumulated such that over a one-year period patients would have received nearly 500 days’ worth of medication. Surely, these extra fills benefitted the dispensing pharmacy, but at an inappropriate cost to patients and plan sponsors.

See the tips below to ensure that your medication synchronization program will stand up to PBM scrutiny and keep you out of harm’s way.

PAAS Tips:

Become an audit assistance member today to continue reading this article. As a member, you’ll have access to hundreds of articles and receive our monthly proactive newsletter!

Join today!

  • Be aware, State pharmacy regulations may prohibit, or require additional documentation for, automatic refill programs
  • Payer restrictions may also apply (e.g., Medicare B/D and Medicaid)
  • Automatic mailing and delivery of prescriptions often have additional requirements
  • Best Practices for Med Sync include:
    • Having patients opt in for med sync (preferably with a retrievable signature to support enrollment documentation)
      • Consider annual reverification
    • Cycling prescriptions at ≥ 90% utilization
    • Avoid putting bulk items like inhalers, insulin, eye drops or topicals on med sync
    • Do not put “as needed” (aka PRN) or controlled substance medications on med sync

A Need for a Compliance Program – Attest with Confidence

Since 2009, PAAS National® Fraud, Waste & Abuse and HIPAA Compliance program was designed to meet the CMS requirements, with the full support of our expert staff – pharmacists and technicians just like you, with years of experience helping community pharmacies with FWA and HIPAA compliance. Don’t be fooled by offers for training and exclusion checks – work with the best compliance program available to community pharmacies!

Consider the following:

Humana’s 2022 Notice of Program Requirements

Humana’s Compliance Policy for Contracted Healthcare Providers explicitly states pharmacies must have a compliance program that meets the seven elements outlined by CMS, including written policies, procedures and standards of conduct. Per the 2022 Pharmacy Compliance Education and Training Requirements FAQs: “Humana reserves the right to request documentation (e.g., policies and tracking records) confirming that your organization has an effective compliance program that meets the requirements outlined in the Compliance Policy and Standards of Conduct.”

PerformRx Pharmacy Compliance Attestation 2022/2023

PerformRx requires attestations to the following:

The pharmacy has implemented and maintains a compliance program that is consistent, at minimum, with applicable federal and state requirements, including, but not limited to the standards set forth in 42 CFR §423.504(b)(4)(vi) and other Centers for Medicare & Medicaid Services (CMS) guidance set forth in the Medicare Part D Prescription Drug Benefit Manual.

Be proactive. Be prepared. Be protected. Ensure you have all your compliance bases met so that when you attest to having one, you can provide proof if requested for credentialing or audit.

Don’t have an FWA/HIPAA Compliance Program? Contact PAAS and receive a $126 discount when you combine services with your audit assistance. Get started today! info@paasnational.com or (608) 873-1342.

Is Your Pharmacy Ready for an Unannounced Audit?

Pharmacies are often startled with the limited amount of time a PBM offers prior to an onsite audit. However, PBM auditors, DEA agents, FDA inspectors and state Board of Pharmacy inspectors can also make unannounced visits.

Ensuring your staff members are prepared in case of an unannounced visit is essential. Since these visits occur without warning, the Pharmacist-in-Charge (PIC) and/or owner may not be working or available to assist. Keeping information in a central location and advising staff on how to handle these intimidating visits will make the process go much smoother.

PAAS National® has created a document to help pharmacies prepare for PBM visits. Located on our website, under the Tools & Aids Section, you can find our Onsite Credentialing Guidelines. This tool provides a list of frequently asked questions from auditors. The guide also includes references to the Policy and Procedure Manual for PAAS National® Fraud, Waste & Abuse and HIPAA Compliance members.

Become an audit assistance member today to continue reading this article. As a member, you’ll have access to hundreds of articles and receive our monthly proactive newsletter!

Join today!

PAAS Tips:

  • Anyone requesting access to PHI (or your professional service area) should be identified with a company issued picture ID and other validating information
    • Follow your pharmacy’s HIPAA policy for visitors. PAAS FWA/HIPAA members can document information on their Visitor’s Log located in their Policy and Procedure Manual
  • Check PAAS’ newest guide How to Be Prepared for An Onsite Audit located in our Tools & Aids Section
  • Make sure all staff are:
    • Up to date on FWA and HIPAA compliance training
    • OIG and GSA exclusion checked; required monthly, PAAS performs these checks daily for our FWA/HIPAA members and records are accessible on the PAAS Member Portal
  • Review and update your FWA/HIPAA Compliance Manual and the Onsite Credentialing Guidelines with your Compliance Officer and/or PIC
  • Keep copies of all documents requested by auditor or inspector
  • Keep copies of any documents you are requested to sign
  • Contact PAAS once your PBM visit is over as we can track this information to better serve all members based on your experience

Don’t have an FWA/HIPAA Compliance Program? Contact PAAS and receive a $126 discount when you combine services with your audit assistance. Get started today! info@paasnational.com or (608) 873-1342.

Why PAAS Cultural Competency?

Developed by pharmacists for community pharmacies, PAAS National® brings you a tailored approach to Cultural Competency and Linguistically Appropriate Services using the PAAS Care Model. Your training history is documented, retrievable and easily tracked throughout the year. Simply put, the training is more realistic for pharmacy staff, and documented should you ever need evidence of completion – training, done better.

“We understand there is a need to address federal and state requirements and meet PBM credentialing requirements,” stated Trent Thiede, President at PAAS National®, “The PAAS CARE Model can be used in any patient interaction to help identify a patient’s cultural differences and guide the pharmacy on how to proceed.”

The PAAS CARE Model is an acronym for Competence Evaluation, Adherence, Realistic, Evaluate and Educate in the training module. Our adage of “Be aware to CARE” uses real-life, pragmatic examples to serve as a launching pad for enhancing patient experiences. PAAS’ unique approach to training ensures its content resonates with all pharmacy staff, making the goal of cultural competence achievable, across the board.

Plus, if you are already a PAAS Fraud, Waste & Abuse and HIPAA Compliance member, your employees will have the ease of completing their FWA, HIPAA and Cultural Competency training on one screen. No clicking to multiple programs or browsers to access the yearly training for your staff.

If you would like more information about PAAS Cultural Competency Training Program starting at $99/year, please visit paasnational.com/culturalcompetency or contact PAAS National® at (608) 873-1342 or info@paasnational.com.