$32 Million Kickback Scheme Involving Medicare and TRICARE

According to an August 18, 2023 press release from the U.S. Attorney’s Office, District of New Jersey, a former president of a pharmacy business pleaded guilty to a scheme that violated the Federal Anti-Kickback statute. For a little over 3 years, this individual engaged in fraudulent activity by paying marketing companies to direct prescriptions for expensive medications with high reimbursement to his pharmacies. The marketing companies would identify Medicare and TRICARE beneficiaries and convince them over a recorded phone call to try expensive creams and migraine medications. Then they forwarded these recorded phone calls with a pre-printed prescription pad for the medications with high margins to telemedicine companies. For every beneficiary referred for a prescription, the marketing company would provide a kickback and the telemedicine company would pay the doctors to approve the prescriptions. These prescriptions were then filled at the pharmacies in which they had a kickback agreement. The pharmacies received payment and sent part of each reimbursement to the marketing companies as a kickback. This scheme caused a loss of over $32 million dollars billed to Medicare, TRICARE, and other federal health benefit programs. This violation of the Anti-Kickback Statute has a potential penalty of five years in prison and a maximum fine of $250,000, or twice the gross gain or loss that occurred, whichever is greatest.

Ensure your pharmacy has a robust Fraud, Waste, and Abuse Compliance Program in place for employees to understand the repercussions of violating laws and regulations such as the False Claims Act and the Anti-Kickback laws. Contact PAAS National® for more information on our comprehensive program that is easy to set-up, web based and customized for your pharmacy.

PAAS National® Announces USP 800 Compliance Program

PAAS National® is excited to announce the USP 800 Compliance Program for community pharmacies. Developed by community pharmacists, PAAS brings you a community pharmacy tailored approach to USP 800 operational needs.

“Empowering community pharmacies with best-in-class, web-based programs to ensure employee safety and maintain pharmaceutical standards are at the forefront of our priorities. Compliance with USP 800 reinforces our commitment to community pharmacies in reducing their liability while improving patient safety and upholding the highest industry standards in handling hazardous drugs,” stated Carmen Fusselman, Vice President at PAAS National®. “PAAS will provide you with the information necessary to implement a fully functional USP 800 Compliance Program with the least necessary interruption to your day-to-day business.”

The PAAS USP 800 Compliance Program will reduce a pharmacy’s exposure to hazardous drugs through physical processes, written policies and training to ensure compliance with USP 800.

If you would like more information about PAAS USP 800 Compliance Program, please visit paasnational.com/usp800 or contact PAAS National® at (608) 873-1342 or info@paasnational.com.

Breyna™ – The First FDA Approved Symbicort® Generic With a 0.1 Gram Problem

Breyna™, like Symbicort® is approved as a maintenance therapy for people with COPD and for asthma patients ages 6 and older. For Breyna™ to become a regular generic, the manufacturer (Viatris) had to submit an Abbreviated New Drug Application (ANDA) to the FDA. Viatris had to prove that Breyna™ is comparable to Symbicort® in dosage form, strength, route, quality, performance characteristics, and intended use. Below is a chart comparing Symbicort®, its authorized generic and the new “regular” generic Breyna™ (also known as an ANDA generic).

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Product NDC Labeler FDA Application Number Package

Size (gm)

 Source
Symbicort® 80-4.5 MCG 00186-0372-20 AstraZeneca 021929 10.2 Brand
Budesonide-Formoterol Fumarate 80-4.5 MCG 00310-7372-20 Prasco 021929 10.2 Authorized Generic
Breyna™ 80-4.5 MCG 00378-7502-32 Mylan 211699 10.3 ANDA Generic
Symbicort® 160-4.5 MCG 00186-0370-20 AstraZeneca 021929 10.2 Brand
Budesonide-Formoterol Fumarate 160-4.5 MCG 00310-7370-20 Prasco 021929 10.2 Authorized Generic
Breyna™ 160-4.5 MCG 00378-7503-32 Mylan 211699 10.3 ANDA Generic

PAAS Tips:

  • The Breyna™ inhaler comes in a package size of 10.3 gm, which is different than Symbicort® and its authorized generic that come in a package size of 10.2 gm
    • PAAS would recommend the pharmacy obtain a new prescription for Breyna™ due to the different package sizing. If a prescriber writes for Symbicort® 10.2 gm, one inhaler with 5 refills, a total of 61.2 gm was authorized. If a pharmacy bills and dispenses all 6 fills using the Breyna™ NDC, this would be 61.8 gm total. If audited, a PBM could recoup the last claim due to dispensing an overbilled quantity that was not authorized.
  • See our updated Inhaler Chart on the PAAS Portal
  • What is an Authorized Generic?
    • An authorized generic is the exact same drug product as the brand, including both active and inactive ingredients
    • It is often made in the same facility and on the same equipment as the brand with the generic name on the label instead of the brand name, and sold at a lower price
    • Note that the FDA approval numbers are the same for the brand and the authorized generic
    • Considered to be therapeutically equivalent to its brand-name drug because it is the same drug
  • What is a Regular Generic (ANDA)?
    • An ANDA generic is the same brand-name drug in active ingredients, conditions of use, dosage form, strength, route and for the most part labeling, but may have certain minor differences such as inactive ingredients
    • Typically developed and made by a company other than the company that makes the brand-name drug.
    • Has a different FDA application number than the brand name and authorized generic
    • Must confirm bioequivalence to the brand name
  • See the FDA website for additional discussion on Authorized Generics

Signature Required – Proving Patient Receipt

The Public Health Emergency for COVID-19 ended on May 11, 2023, and PBMs notified pharmacies that they would once again be requiring signatures for proof of patient receipt of medications. Since then, PAAS National® analysts have taken questions about what format signatures logs should take. The following tips should help your pharmacy stay compliant.

PAAS Tips:

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  • Point of sale electronic signature logs should contain:
    • Prescription number
    • Date filled or fill number
    • Date of pick-up
    • Signature of the patient or the representative who picked-up the medication for the patient
  • Delivery logs should contain:
    • Patient name
    • Prescription number
    • Date filled or fill number
    • Date delivered – cannot be pre-printed
    • Delivery address – pharmacy, patient, or facility
    • Signature of the patient or the representative who accepted the delivery
  • Check your delivery logs for a blank date field (i.e., not pre-populated) and consult with your software vendor to add a signature date field (or electronic date stamp), if needed
  • Consider using the PAAS National® Trifold Mailer if unable to get a patient signature upon delivery
  • Pharmacies using manual signature logs should consider downloading and printing the PAAS National® Signature Log Book from the “Forms” tab on the PAAS Member Portal
  • Pharmacies mailing prescriptions have additional requirements to prove receipt
  • Be aware of PBM return to stock policies by using the PAAS National® Return to Stock chart

Recent DEA Rule Change – Transferring Electronic Prescriptions for Controlled Substances for Initial Fill

The DEA published a couple rule changes recently which pharmacies need to be aware of. In the September 2023 Newsline, the updated rule regarding partial fills for controlled substances was discussed. The other recent change published in the Federal Register was titled, Transfer of Electronic Prescription for Schedules II-V Controlled Substances Between Pharmacies for Initial Filling. This rule went into effect August 28, 2023, and clarified the DEA’s previous rule on the transferring of controlled substances. Pursuant to 21 CFR § 1306.08, Electronically Prescribed Controlled Substances (EPCS) can be transferred for initial filling on a one-time basis, upon the request of the patient and all authorized refills on C-III, C-IV and C-V prescriptions are transferred along with the original prescription. All the following additional requirements must also be met:

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  1. The transfer must be communicated directly between two licensed pharmacists, which includes any person (e.g., pharmacist intern) who is authorized by a State to dispense controlled substances under the supervision of a pharmacist licensed by such State.
  2. The prescription must remain in its electronic form with no intermediary conversion to another form (e.g., facsimile).
  3. The contents of the prescription required by 21 CFR part 1306 must be unaltered during the transmission. Any change to the data, including truncation or removal of data, will invalidate the prescription.
  4. The transfer for EPCS for initial dispensing is permissible only if allowable under existing State or other applicable law.

According to the Federal Register notice, NCPDP confirmed SCRIPT Standard Version 20177071 had the appropriate functionality to allow the electronic transfer of an EPCS. Since this SCRIPT Standard is widely used among software vendors for chain and independent pharmacies, the capability to electronically transfer these prescriptions should be available; however, pharmacies may need to talk with their vendors about activating this functionality.

When a patient requests the transfer, the receiving pharmacy must initiate the process by electronically requesting the transfer. The “transferring pharmacy” must update their records to show the prescription was transferred out and include:

  • Name, address, and DEA number of the receiving pharmacy.
  • Names of the transferring and receiving pharmacists.
  • Date of the transfer.
  • Note: The transferring pharmacy is not responsible for maintaining proof of the patient’s request to transfer the prescription.

The “receiving pharmacy” must document:

  • The word “transfer” in the electronic prescription file.
  • Name, address, and DEA number of the transferring pharmacy.
  • Names of the transferring and receiving pharmacists.
  • Date of the transfer.

The software system may pre-populate the data entry fields if the pharmacist verifies the accuracy of the information.

PAAS Tips:

  • If a paper prescription for a controlled substance is presented to the pharmacy and the pharmacy is unable to fill it, give the prescription back to the patient to take elsewhere (remember to keep a copy of the prescription and the reversed claim on file in the event of an audit to prevent accusations of phantom claims)
  • Remember to maintain all documentation related to the transfer for a minimum of two years from the date of the transfer per Federal law; longer if dictated by State law, Medicare Part D or PBM contract requirements
  • Do not partial fill a controlled substance, then transfer the remaining quantity on the prescription to another pharmacy to dispense the rest of the partial fill because there is currently no law which allows this practice; pharmacies may only transfer the whole prescription for the initial fill pursuant to 21 CFR 1306.08 or transfer a C-III, C-IV or C-V (paper, oral, or electronic) prescription to another pharmacy for the purpose of refill dispensing pursuant to 21 CFR § 1306.25

[FREE PAAS Webinar] Awareness to Action: Initiating USP 800 Compliance in Community Pharmacies

Join Vice President of PAAS National®, Carmen Fusselman, PharmD as she discusses:

  • Why your pharmacy needs a USP 800 Compliance Program for handling hazardous drugs
  • Requirements of USP 800 compliance program in community pharmacy
  • Implementing a fully functional program with the least interruption to your day-to-day business

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.

PAAS Audit Assistance members will have access to a recording on the PAAS Member Portal if they are unable to attend the live event.

Register Today!

Auditors’ Latest Trick for Flagging “Misfilled” Prescriptions

PAAS National® analysts are noticing more prescriptions being flagged for recoupment based on “incorrect” instructions for use on the patient label. Pharmacies and PBM auditors have very different perspectives on what a “misfilled” prescription is. PBMs will look to categorize a claim as a “misfill” if the directions on the patient label do not include all instructions (including any clarifications made with prescriber). Appealing these discrepancies successfully can be a fruitless endeavor, predicated on circumstances and PBM guidelines.

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OptumRx discrepancy is listed as 3H-Directions on prescription different from computer records. No post-dispensing validation accepted. No verbal orders/annotations accepted.

Caremark discrepancy is listed as MIF-Prescription dispensed was filled with incorrect drug, strength, directions or patient. This discrepancy does not require further documentation.

Pharmacies are often very familiar with prescribers and what they may intend to include on the prescription but don’t. This can range from a clear quantity to actual instructions for the patient. Unfortunately, pharmacies supplementing or documenting clinical notations that do not make it on to the patient’s prescription label can face recoupment as a “misfilled” prescription.

Some of the common examples PAAS analysts see are when information was clarified or confirmed with the prescriber and added to the prescription but not included on the patient label:

  • Max daily dose for insulin with sliding scale or titration
  • Number of snack and/meals for pancreatic enzymes
  • Grams per application or area applied for topical medications

Additionally, PAAS is seeing issues where the pharmacy’s backtag and label do not include the entire set of instructions (i.e., an extended sig/label). Many software vendors only allow so many characters in the instruction field and may require additional instructions to be entered/printed separately. Not providing all the instructions the patient received [upon audit] would likely result in the claim being flagged for recoupment.

PAAS Tips:

  • Verifying information with the prescriber prior to dispensing
  • Clinical notes to document clarifications should include 4 elements
    • Date/time
    • Name and title of who you speak with
    • Summary of discussion
    • Pharmacy staff initials
  • Educate all data entry staff to include information on patient label that is related to the instructions for use
  • When submitting documentation for audit, be sure the auditor is receiving all information

An Easy Procedural Change That Will Prevent Recoupments

As previously reported in an April 2023 Newsline article, Prepare Yourselves! Onsite Audits Are Coming in Strong, PAAS National® saw a 300% increase in onsite audits in just the 3rd Quarter of 2022, and we have continued to see the number of audits, as well as the information requested in these audits, increase. It is therefore pertinent that pharmacies review and enforce their FWA/HIPAA policies and procedures, such as return to stock, to prevent petty recoupments.

Return to Stock, the timeframe PBMs require prescriptions to be picked up or the claim reversed based on the fill date of a prescription, is a focus of onsite audits when the auditor inspects the Will Call bin or desk audits when a signature log is requested. If the auditor identifies the sold/received date is beyond the PBM’s Return to Stock threshold, there is risk for full recoupment of the claim.

When determining what Return to Stock window is appropriate for your pharmacy, consider the following: 

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  • Each PBM’s Return to Stock window varies. How many days from the date of the adjudicated claim does the patient have to pick up the prescription before it is returned to stock? Is that number of days based on calendar days or business days?
  • When is your pharmacy filling prescriptions relative to when the prescription is being delivered to long-term care facilities, mailed to patients, or sent out for delivery?
  • What processes are in place to contact the patient when they have a prescription ready to be picked up? Does the patient receive a text message or phone call that a prescription is ready for pick-up? Do you contact the patient after a certain number of days to check if they still need the prescription?
  • What processes are in place depending on the type of prescription? Do you put all bowel preparation or post-procedure prescriptions on hold until they are requested?
  • Review PAAS’ Return to Stock chart, located on the PAAS Member Portal under Days’ Supply Charts, which includes the Return to Stock policies for major PBMs. For other PBMs that you serve and are not listed on our chart, refer to the respective PBM Provider Manual.

All above information should be considered when reviewing your pharmacy’s FWA/HIPAA policy and procedure manual (Section 4.1.1 Unclaimed Prescriptions for those utilizing PAAS’ FWA/HIPAA Compliance program). Make modifications as seen fit.

Lastly, see if your pharmacy system can help stop prescriptions that would be sold beyond your designated Return To Stock window. Certain dispensing platforms, with an integrated Point of Sale system, can have claims stopped at the register to avoid noncompliance.

PAAS Tips:

  • In order to be adherent to the vast majority of PBMs, PAAS suggests considering a 7-10 calendar days return to stock policy for your pharmacy
  • Contact software vendors about providing daily reports that reflect which claims have not yet been picked up and are approaching your Return to Stock window
  • Prior to an onsite audit, do an extra pass of your will call bin to ensure all prescriptions waiting to be picked up are within your Return to Stock window
  • REMS prescriptions may require specific restrictions for pick up, see our June 2021 Newsline, Would Your REMS Prescription Pass an Audit?
  • If a patient informs you that they will be picking up their prescription but it will be after your Return to Stock window, reverse and rebill the claim. Notating on the prescription that the patient was contacted and will be coming in at a later time will not suffice for PBM’s purposes
  • Partial/Completion, and LTC prescriptions are not exempt from Return to Stock policies
  • Do not have patients sign for prescriptions that were previously received as this is not an accurate reflection of the date the patient obtained the prescription
  • Refer to our March 2023 Newsline, PBM Trend That Never Changes? Return to Stock Policy Violations

Utilizing the PAAS Audit Activity Tracker

While seemingly mundane, the PAAS National® Audit Activity Tracker can serve a very important purpose. While pharmacy personnel may use this tool to stay organized with various audits coming their way, this tool can also be used to defend the pharmacy should an audit go awry. It’s better to document and have a record at the onset than to think back months ago about your individual efforts on an audit. This tool provides a structure to document important information during your audit process. Utilizing this tracker can provide credible documentation of a PBM’s (or auditors) ineffectual communication during an audit. This could help support an audit manager’s review of the auditor’s conduct or provide you with information to complain to your state insurance commissioner.

Here are some recommendations to include on the Audit Activity Tracker:

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  • Dates and times for:
    • Audit receipt and corresponding due date (along with audit result timelines)
    • Any communications with auditor
    • When onsite auditor arrives and leaves
    • Pharmacy attempts to contact auditor
  • Summary of discussion with auditor regarding questions or concerns
  • Requests and approval of any extension of due date
  • Action taken to escalate to audit manager/supervisor

Example:

Audit Activity Tracker
Date/Time Item Notes/Comments
4/20/2023 Audit Received Audit letter dated 4/10/2023
5/1/2023 @ 1:00pm Extension Requested Contacted auditor William Henry by email to request extension
5/8/2023 @ 3:30pm Extension Left VM for auditor mention email request for extension
5/9/2023 @ 2:00pm Received Extension and new due date Auditor responded to email request for extension. New due date is 6/10/2023
5/9/2023 @ 2:15pm Auditor Call Auditor, William, called to inform pharmacy of extension as follow-up to email. I also asked about ‘Computerized Dispensing Records’. William, stated I would not need to submit that information with the audit.
6/7/2023 @ 8:45am Audit sent to PBM Fax confirmation attached (or tracking # noted if mailed)

PAAS Tips:

  • Attach the Audit Activity Tracker to any audit request you receive
  • Educate all staff involved in the audit process on how to utilize the tracker
  • Keep audit documents organized and readily available
  • Be prompt when adding information to the tracker to ensure accuracy
  • Visit the PAAS National® Member Portal for additional Proactive Tips

Podcast: A Deep Dive into LTC Audits with Trent Thiede

Trent Thiede, President of PAAS National® and host of Amplify Long-Term Care Pharmacy Podcast, Frances Nahas talk all things pharmacy audits, from transitions of care to the complicated (and necessary) role PBMs play. Tune in to learn surprising insight of LTC audits to take your long-term care program to the next level.

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