Making Pharmacy Audits Easier
Audits are inevitable. A group of community pharmacists weighs in on ways to minimize the time and expense associated with them.
If your community pharmacy hasn’t been audited yet, chances are it will be soon. That’s because it seems to many pharmacists that the frequency of audits — both Medicare and private insurance claims — continues to increase.
Chris Darling, who owns three Health Mart® pharmacies in Pennsylvania, says his stores were audited about 30 times in 2012. Dave Feeney, owner of Oxnard Health Mart Pharmacy in Rhode Island, only went through four audits in 2012 — but they were all time-intensive field audits. And John Coler, owner of five Health Mart pharmacies in eastern Ohio, says that his staff is typically handling three to five audits at any given time.
“There’s absolutely nothing you can do to prevent audits,” says Coler. His director of operations, Greg Paisley, agrees: “It’s like inventory,” he says. “You’re never going to be done with it.”
The True Cost of Audits
Increasingly, auditors appear to be focused mainly on spotting clerical errors. Pharmacists say that auditors often attempt to take back reimbursements even when patients have received the correct drug or dose.
The real issue is the time it takes a pharmacy owner to defend against an audit. “You can devote several thousand dollars in pharmacists’ and technicians’ time … the people who understand how to do the actual fulfillment of the audit requests,” says Darling. Multiply that by 30 audits per year and the financial burden becomes extreme.
Feeney estimates that dealing with an audit at his store takes about four to six hours for both a pharmacist and a senior technician. And he says it’s an ongoing struggle to avoid the kind of clerical errors that auditors pounce on.
Minimizing the Impact
These pharmacy owners are in agreement: Audits are inevitable, and they consume a considerable amount of time that could otherwise be spent on patient care. Some of the steps they take to minimize the disruption include:
- Ongoing education. All staff pharmacists and technicians must receive ongoing training and must be prepared to follow the different rules set by individual insurers and PBMs. It takes “constant vigilance” to ensure that you have followed all the necessary steps to avoid mistakes, says Feeney. “Proper documentation on the original hard copy prescription is crucial,” says Darling.
- System “edits.” These are event-triggered reminders that display on the pharmacy system, and the pharmacists say they can be an enormously helpful tool. However, training still is essential because some staff members will skip over these reminders, rendering them ineffective.
- Audit tips. Feeney relies on audit tips that he receives regularly from AccessHealth. He says that the tip sheets are “especially beneficial” because they give advance notice of what PBMs are looking for on hot-button issues.
- Audit assistance. Darling swears by the audit assistance he receives as part of McKesson Reimbursement AdvantageSM (MRA) — a comprehensive reimbursement optimization package from McKesson’s AccessHealth managed-care support division. As part of the MRA services, Darling receives a monthly report of drug claims that are likely to set off red flags for auditors. “MRA is worth the extra fee, especially for larger stores that gross at least $2 million annually,” he says.
One more point: All of the pharmacists emphasized the importance of supporting legislation that limits the impact of audits. “If we aren’t talking to legislators, then they are only hearing from [one side],” says Paisley.
Read “Making Our Voices Heard,” for tips on how to reach out to policymakers.
Preparing for an Audit
When the inevitable occurs and your pharmacy is targeted for an audit, take basic steps like these to prepare:
- Review audit rules. Soon after receiving written notification of an impending audit, review the relevant PBM manual’s audit section to become familiar with all rules and procedures. Typically, information about the audit process is in the manual, not the contract.
- Confirm the audit’s scope. The most recent audit notice for Feeney’s Oxnard Pharmacy gave a date range of November 2011 to October 2012. But he asked for, and received, the relevant prescription numbers as well. Note: AccessHealth is able to provide its members with claims listings for given date ranges.
- Gather and review documents. Collect all relevant documents and prescriptions in advance and have them ready for the auditor. Double-check the records, inspecting for missing signatures and other mistakes. (See a list of common errors at the end of this article.)
- Prepare proof of training. Make sure you can produce documented proof of Fraud, Waste and Abuse (FWA) training. If you can’t, some auditors might “assume” that you didn’t train your employees.
- Check for exclusions. Pharmacies should check the Office of Inspector General (OIG) exclusion list when hiring, and monthly thereafter, for each employee. Click here for the exclusion list. Click here for Frequently Asked Questions about exclusions on the OIG website.
- Arrange for relief staff. In general, prepare for one pharmacist and one senior technician, specifically trained in audit procedures, to dedicate their time during the audit.
- Dedicate space. Set up a table and chairs in a comfortable area. As much as possible, make sure that the space is located away from product shelves, records, and computers and does not disrupt customer interactions.
- Confirm an auditor’s identity. Take a moment to check the ID or badge of the auditor(s) before allowing them to view confidential records, and have them sign in and out per HIPAA and/or HITECH regulations.
The unfortunate reality is that audits are unavoidable for all community pharmacies. However, you can take back control by implementing procedures to decrease the mistakes that trigger audit penalties. And you can take basic steps to prepare for audits so that they go as smoothly and quickly as possible.
- Not maintaining hard copies of prescriptions.
- Dispensing incorrect days’ supply.
- Using incorrect Dispense as Written (DAW) codes.
- Filling prescriptions that lack or contain inaccurate directions.
- Dispensing quantities other than prescribed.
- Using incorrect National Drug Codes (NDCs) or package sizes.
- Failing to obtain prescriber signatures or proof of delivery.
- Not providing proof of annual training.