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The Best Defense Against an Intrusive Pharmacy Audits . . . a Pharmacy Management System

A popular blog written by an Iowa pharmacy owner recently detailed the author’s experiences with audits of his business.  “Over my career as a pharmacy owner, we have faced over $1,000,000 worth of audited claims, and the PBMs have attempted to charge back over 10% of that amount,” the blogger wrote.  “A single audit may include over 100 individual prescriptions representing as many as 250 dispense dates and may represent over $100,000 in sales.”

“Over my career as a pharmacy owner, we have faced over $1,000,000 worth of audited claims, and the PBMs have attempted to charge back over 10% of that amount,”

This particular pharmacist went on to note his near-100 percent success rate in defending his pharmacies from unfair chargebacks – a process that required a considerable investment of time and energy.

Similar examples were reported by Health Mart, which cited one Pennsylvania pharmacy owner whose three stores were audited “about 30 times” in a single year.  Another owner of five pharmacies in Ohio said his staff typically handles three-to-five audits at any given time.

Pharmacy audits can come at any time, and in many forms, ranging from a less-intrusive telephone audit to a highly-invasive field audit, which can consume dozens of hours in preparation, plus days spent meeting with auditors and addressing points of inquiry.  Hanging over all audits, of course, is the threat of financial repercussions, including clawbacks of fees determined to have been paid in error, penalties, and even contract cancellations.

While no two audits are ever exactly the same, most have a few key elements in common, namely the need to provide seamless documentation trails for all critical pharmacy transactions, including prescribing and billing practices, invoice maintenance, and controlled substance management.

The good news for pharmacy managers though, is that whereas locating required documentation and records used to mean hours spent hunting through file boxes, today that information can be just a few clicks away.  A pharmacy’s technology solution, which already serves as the pharmacy workhorse by facilitating pharmacy workflow and prescription filling processes, can also be a one-stop solution for most-requested audit documents.

  • A comprehensive technology system will allow for the capture, archiving and storage of critical capabilities including:
  • Electronic signature logs
  • Proof of prescription pick-ups and deliveries
  • Copies of all prescriptions, both front, and back
  • Payment documentation
  • Coordination of benefits
  • Prescription inventory records
  • Copies of all pharmacy correspondence, including exchanges between the pharmacy and patient
  • Automatic inventory management and reordering procedures
  • Automatic inventory adjustments to reflect medications returned to stock
  • Verification of prescriber credentials
  • Assignment of NDC codes
  • Proper billing practices for generic and brand-name drugs
  • Documentation for controlled substance handling
  • Automatic warning trigger for potential over-prescribing of opioids and other controlled drug categories.
  • Automatic triggers to reduce dispensing errors; and
  • Seamless insurance claims management.

Easy access to any of these data elements can be a tremendous time saver in preparing for an audit and allow pharmacy managers to address auditor documentation requests.

Micro Merchant Systems has released a new white paper, “Manage Pharmacy Audit Risk with Technology and Internal Controls,” that provides a more in-depth discussion about today’s audit procedures, and opportunities to better prepare for the inevitable audit notification.

With the right technology solution in place, pharmacy audits no longer have to mean panic and worry.

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