Do You Have Adequate Proof of Patient Copay Collection?

Pharmacies with an integrated point of sale (POS) system have an easier time providing proof that a copay collection happened at the point of sale. POS systems can tie the prescription number, date of sale, dollar amount collected and the method of collection all together in one place, typically in the form of a receipt. This data is stored within the pharmacy’s system and can be easily printed when needed. Pharmacies without a POS system often struggle to find any/adequate proof of copay collection.

Aside from ensuring that you have an integrated POS system for convenient data retrieval, there are a few other things to consider when audited for proof of copay collection. PBMs want to know how a copay was collected, and simply listing “cash, check or card” will not suffice.

Credit Card receipts should include the last four digits of the credit card number, the transaction authorization number, and the merchant ID number (PBMs typically prohibit pharmacies from outsourcing copay collection, so the merchant ID should be under the pharmacy’s name).

Check payments may require copies of cancelled checks, front and back.

Payment made by cash may require proof of cash bank deposits being made during the timeframe under audit.

Was a secondary payer involved? This can mean a coupon or secondary insurer was also billed and that may require additional proof including:

• A print screen showing adjudication to the secondary insurer
• Secondary payer plan information like the BIN, PCN, Patient ID, and group number
• Any eVoucher data applied by the switch
• Amount paid and any remaining out of pocket amount

When using a house charge account, pharmacies should be able to produce the following:

• Policy and Procedure for collection of monies due on the account
• Documented attempts to collect payment in the form of dated invoices sent to the patient and logged phone calls attempting to collect
• Itemized Accounts Receivable report showing payment received, tying the payment back to the prescription number, and any outstanding balance remaining

If waiving a copay due to financial hardship, pharmacies will need objective evidence of that hardship, like an application, tax returns, and a formal written Policy and Procedure. Caremark’s Network Provider Manual highlights waivers in section 3.03.08 as well as distinct expectations for pharmacy financial hardship programs in section 3.03.09. Financial hardship cannot be advertised or promoted, nor funded, in whole or in part, by a third party. It must also meet all requirements and restrictions of applicable law.

Non-routine, unadvertised waivers of copayments based on individualized determinations of financial need for patients with Medicaid may be acceptable without a financial hardship Policy and Procedure.

PAAS Tips:

• Consider using an integrated POS system as a convenient way to collect proof of copay data
• It is best practice that all copays should be collected at the time of sale
• Utilizing house charge accounts requires having a strong Policy and Procedure regarding copay collection
• Follow good cash handling policies like:
  • Making bank deposits at regular intervals
  • Avoid taking money directly from the register for business related expenses
  • Balance the register at the end of each day
• For more information, please see the following Newsline articles:
  • Proof of Copay Collection – Secondary Payers Hidden in Plain Sight (March 2023)
  • Staying Compliant with House Charge Accounts (January 2024)
  • Best Practices for Financial Hardship Waivers (December 2023)[SW1] [SW2] 
  • Changing Pharmacy Management Software? Don’t Neglect Record Retention! (April 2025)
• PAAS Fraud, Waste & Abuse and HIPAA Compliance members should review section 4.1.5 – Copay Collection in your Policy and Procedure Manual