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Best Practices For Avoiding or
Surviving an Audit
GREG REYBOLD, J.D .
OBJECTIVES•Identify red flags that are likely to trigger an audit•Develop and implement simple policies and procedures to help limit common errors•Understand pharmacy appeal rights under Georgia law•Appeal state and private payor initial audit determinations or substantive and procedural grounds
DISCLOSUREI DO NOT have (nor does any immediate family member have) actual or potential conflict of interest, within the last twelve months, a vested interest in or affiliation with any corporate organization offering financial support or grant monies for this continuing education activity, or any affiliation with an organization whose philosophy could potentially bias my presentation.
Attending this presentation, or using the information it contains does not create an attorney-client relationship. No information provided should be construed to constitute legal advice. If you have questions about these or other legal issues please contact an attorney.
WHAT IS AN AUDIT?
•Inspection of pharmacy records in order to identify fraud & abuse•Identify errors/omissions•Often times result in recoupment
PROVIDER AGREEMENTS VS. PROVIDER MANUALS
PROVIDER AGREEMENTS1. Language is usually far reaching and
includes ability to review prescription records, original prescriptions, signature logs, patient care info
2. Contemplate the ability to recoup funds in connection with discrepancies
3. Often set forth appeal rights
PROVIDER MANUALS1. Incorporated by reference into PBM
provider agreements
2. Are updated periodically and updates can impact rights on wide range of issues including audits
3. Often provide more detailed information regarding audits, their process, and appeals process
AUDIT TRIGGERS
•Generic, multi-source brand, and single source brand fill rates
•Generic substitution
•DAW code usage
•Average claim amount
•Quantity dispensed vs. days supply and FDA guidelines vice versa
•Usual and customary (U&C) retail prices
•Reversals
•Compounding
•Formulary compliance
•Prescriber profiling
•Referral from plan members
•Referral from plan sponsors
•Random selection
COMMON AUDIT ERRORS•Prescription labels
•Signature logs
•Quantity dispensed
•Instructions-Use as directed
•Failure to reverse claims when RX not received by covered person within specified time period
•Incorrect NPI numbers
•Bypassing prior authorization requirements
EXAMPLES OF RECENT AUDITS
AVOIDING ERRORS
SOUND FUNDAMENTALS
•Get the basics right• The most common errors are the most
basic•Deficient prescriptions, billing errors,
signature logs
•Pharmacies and pharmacists are extremely busy and most of the discrepancies I see are clerical in nature. Patients are getting the right drug as prescribed so auditors go after the low hanging fruit.
AVOIDING ERRORS CONTINU
ED
REQUIREMENTS OF A PRESCRIPTION DRUG ORDER PER THE GEORGIA BOARD OF PHARMACY RULES
Board Rule 480-10-.15
1. Full name and address of the patient;
2. Name, address of the prescribing practitioner and DEA registration number in the case of controlled substances;
3. Date of issuance;
4. Name, strength, if needed, dosage form and quantity of drug prescribed;
5. Directions for use by the patient;
6. Refills authorized, if any;
7. If a written Prescription Drug Order, prescribing practitioner’s signature; and
8. A serial number assigned by the Pharmacist so that Prescription Drug Orders may be filed in a numerical and retrievable sequence.
Are There Additional Requirements for Prescriptions Written By PAs and NPs?
YES. Board Rule 480-10-.15 specifies that prescription requirements include any information required by Rule 480-22.
Rule 480-22 is filled with specifics…
(b) If the prescription is for controlled substances, the PA has a DEA number.
(c) The prescription drug order must be on security paper and include the following:◦ (i) The name, address, and telephone number of the supervising physician and the PA;◦ (ii) The patient’s name and address;◦ (iii) The drug name, strength, and quantity prescribed;◦ (iv) The directions to the patient with regard to taking the drug;◦ (v) The number of authorized refills, if any;◦ (vi) A NPI number; and◦ (vii) If applicable, the DEA permit number of the PA {controlled substances III-V}
Avoiding Errors-Sound Fundamentals
The basics continued…•Know requirements for what goes on a prescription drug label
•Board Rule 480-22-.10 – Labeling of Controlled Substance Prescription Drug Orders
•O.C.G.A. 26-4-80 (k)
QUIZ - MEDICAID•Can a pharmacy fill a prescription signed by a medical resident?
•Yes. If the medical resident has an NPI. If not it should be countersigned by the supervising physician.
•When an RX is received from a PA or NP, whose signature is required on the prescription?
•The prescribing PA or NP.
•Whose NPI number is required on the claim?
•The prescribing PA or NP.
Pharmacy Services Manual – pg. 98 (CIII-CV only)
Implementing Practices, Policies & Procedures to
Limit Common Errors•Is the RX complete?
•Has the claim been submitted properly?
•Has the RX been dispensed properly?
•Is the proper documentation in place?
•Education/training
•Staying current on updates
•For every provider obtain the provider manual and documentation policy – don’t let PSAO’s tell you otherwise.
Implementing Practices, Policies & Procedures to
Limit Common Errors Cont.•Have procedures in place so good habits become second nature• Example: Checklist of requirements for valid prescription and for prescription labels• Example: Claims submission checklist
•Attention to detail – quantity, instructions, signature logs
•Self audit – review signature logs/quantity dispensed/information submitted
•Self assess – Identify problem areas and create new procedures
•These steps can save thousands upon thousands of dollars. I have seen recoupment attempts in the $25,000 to $50,000 range based on some of these simple errors.
•Also saves time – obtaining patient attestations and physician statements can be time consuming and in some cases impossible.
PHARMACY AUDIT BILL OF
RIGHTS
• PBM audit rights are expansive and spelled out in provider agreements and provider manuals
• Georgia’s Pharmacy Audit Bill of Rights mandates, with some exceptions, that audits be conducted in accordance with the Bill of Rights
• Not a perfect document but GPhA, AIP, Georgia pharmacists, GPhA lobbyists and many legislators have fought tirelessly to get strong protections for pharmacists
• Revisions were made in 2015 legislative session and took effect July 1• It is incumbent on pharmacists to know their rights
Pharmacy Audit Bill of Rights Continued…
• Entity conducting on-site audit must give pharmacy 14 days notice (previous requirement was one week).
• Period covered by an audit may not exceed two years from the date the claim was submitted or adjudicated unless consented to by pharmacy
• Audit may not be initiated or scheduled during the first seven calendar days of any month.
• Preliminary audit report must be delivered to pharmacy within 120 days after conclusion of the audit.
• Recoupments of any disputed funds allowed only after final disposition of audit including appeals process.
Pharmacy Audit Bill of Rights Continued…
• 30 days following receipt of preliminary audit report to correct a clerical or record keeping error.
• Take advantage and begin process early as it can take time to obtain documentation from physicians or patients.
• PBMs can’t recoup for corrected clerical errors under the law unless the error resulted in an overpayment and then they are limited to recouping the amount overpaid {previously they were able to recoup full amount reimbursed}.
Pharmacy Audit Bill of Rights Continued…
• Exception for DCH audits as DCH is specifically exempted from (b)(3) and so DCH can recoup for corrected clerical errors. (g).
• DCH’s Pharmacy Services Manual does contemplate the ability to correct certain clerical errors in order to avoid recoupment.
• Example 1: Deficient signature logs – patient attestation is allowed.
• Example 2: Missing date on original or phoned in prescription – rewritten RX from physician
Pharmacy Audit Bill of Rights Continued…
• Exception for investigative audits which involve fraud, willful misrepresentation, and abuse.
Other significant developments…• Entity conducting the audit may not pay the agent or employee
conducting audit based on a percentage of the amount recovered.
• Commissioner of Insurance now has enforcement authority over the Pharmacy Audit Bill of Rights.
Pharmacy Audit Bill of Rights O.C.G.A. § 26-4-118
Discussion
• Has anyone here ever relied on the Audit Bill of Rights?
• Examples of violations of the Audit Bill of Rights.
APPEALING AUDIT DETERMINATIONS
You have been audited. You have received the preliminary audit report and there are identified discrepancies for which recoupment is being sought.
NOW WHAT?
Appealing Audit Determinations Continued…
PHASE 1
• Review audit findings; identify RXs at issue; identify discrepancy codes and corresponding supplemental documentation requirements.
PHASE 2
• Determine whether underlying audit findings are correct. This may require review of prescriptions as well as provider manual and documentation policies.
Appealing Audit Determinations Continued…
PHASE 3• Determine whether proper procedures were followed under contract and
Audit Bill of Rights.
PHASE 4
• Determine whether errors are correctable and if so, begin process. This process is exacting and failure to follow instructions perfectly can render the process moot.
Appealing Audit Determinations Continued…
PHASE 5• Identify applicable timelines, processes, and procedural requirements.
There is no room for margin of error here.
PHASE 6
• Appeal and follow-up as necessary.
QUIZ Is a PBM required to give 14 days notice prior to a desk audit? NO. The 14 day notice requirement is limited to on-site audits. If I utilized a PSAO to contract with a PBM on my behalf, am I entitled to a copy of the contract?
YES! Do not take no for an answer. Does DCH have to allow my pharmacy to correct all clerical errors? No, they are exempted out of this requirement.
QUESTIONS?/DISCUSSION
