PHARMACY COMPLIANCE RISK AREAS FOR 2014 2014 San Juan Puerto Rico Regional Compliance Conference Darrell W. Contreras, Esq., LHRM, CHC-F, CHPC, CHRC 5 Risk Areas 1. Overbilling of Herceptin 2. Quality and Safety of hospital-compounded pharmaceuticals 3. 340B Compliance with medication eligibility 4. Medicare Part D overbilling 5. False claims resulting from improper inducements 1
OIG Reviews Herceptin Overbilling of multi-use vials Reviewed 665 line items totaling approx. $1.75 million. 540 line items were incorrect (81%). Overpayment of $635,000 (36%). 440 mg Herceptin/vial Providers billed for the entire vial 1unit is 10mg Medicare Claims Process Manual Chapter 17 Drugs and Biologicals Rule 70: Where HCPCS is required, units are entered in multiples of the units shown in the HCPCS narrative description. For example, if the description for the code is 50 mg, and 200 mg are provided, units are shown as 4; When the dosage amount is greater than the amount indicated for the HCPCS code, the facility rounds up to determine units. When the dosage amount is less than the amount indicated for the HCPCS code, use 1 as the unit of measure. NOTE: Multi-use vials are not subject to payment for discarded amounts of drug or biological. (Section 40) 2
Example 1: HCPCS Drug Dosage J9355 Trastuzumab 10 mg Actual Dose: 140 mg Number of Units billed = Example 2: HCPCS Drug Dosage J3100 Tenecteplase 50 mg Actual Dose: 40 mg Number of Units billed = 3
Example 3: HCPCS Drug Dosage J9355 Trastuzumab 10 mg Actual Dose: 150 mg Vial Size: 440 mg Number of Units billed = 44 Correct Number of Units = OIG Herceptin Review Lessons Learned: Review your Herceptin billing What is the process to calculate units billed? Periodically review the reporting of billable units Check the math Understand different reporting methodologies Billing guidelines vary for different usage types 4
Compounding Pharmacies 2012 NECC Meningitis Outbreak Contaminated injections National attention Patients died Raised concern about documentation and quality of compounding State attention: Quality and documentation requirements added Federal attention: OIG Workplan OIG Workplan Oversight of pharmaceutical compounding (new) Quality of Care and Safety. We will describe Medicare s oversight of pharmaceutical compounding in Medicareparticipating acute care hospitals. We will also describe how State agencies and hospital accreditors assess such pharmacy services in hospitals. 5
State Boards of Pharmacy New Regulations Documentation of each compounding step. Audit trail for at least 2 years Pharmacist oversight Documented process What to Look For: Tracking adverse drug reactions to med prep Tracking quality measures within pharmacy 340B Compliance Audits HRSA oversees contract pharmacy arrangements in the 340B Program OIG Workplan: Tracking of drug sales Only eligible participants can receive 340B drugs. Duplicate discounts No payment of Medicaid rebates for 340B drugs Access to 340B ceiling prices Covered entity access to assess pricing (Required by ACA 7102) Drug manufacturer overcharges 6
340B Audits OPA requirements for 340B compliance (Feb 5, 2014): Conduct independent annual audits or implement an adequate mechanism for oversight of contract pharmacy arrangements; Maintain auditable records, compliant agreements with contract pharmacies and written policies and procedures related to contract pharmacy oversight; Ensure that 340B drugs are delivered only to eligible patients; "Carve out" Medicaid or develop an alternative arrangement with the state Medicaid agency to prevent duplicate discounts; and Maintain accurate information, including contract pharmacy information, in the HRSA 340B database. 340B Audits Lessons Learned: 1. Have a good 340B compliance program in place and audit recipient eligibility 2. Review the controls to prevent duplicate discounts 3. Check manufacturer pricing 7
Medicare Part D Billing fraud May 2012 OIG Report on Retail pharmacies 2637 participating pharmacies with questionable billing practices Issues: Billing for nonexistent prescriptions; Billing for brand name drugs when generic is dispensed; Billing for prescriptions that were not picked up. Medicare Part D Billing fraud Markers: Amounts billed per beneficiary Number of prescriptions per beneficiary Amounts billed per prescriber Number of prescriptions per prescriber Percentage of prescriptions for Schedule II drugs Percentage of prescriptions for Schedule III drugs Percentage of prescriptions for brand-name drugs Percentage of prescriptions that are refills, to identify pharmacies exhibiting aberrant billing patterns. 8
Medicare Part D Billing fraud Lesson Learned: 1. Periodic audit to match bills to prescriptions 2. Match billed medication to prescribed medication 3. Ensure pick-up is documented 4. Review the markers! Medicare False Billing Case Walgreens (April 20, 2012) $25 gift cards given to beneficiaries who transferred prescriptions to Walgreens from another pharmacy Excluded government health care programs Walgreens employees ignored exemptions and provided gift cards to all beneficiaries 9
Medicare False Billing Case False Billing? Impermissible inducement to federal health care program beneficiaries All claims that are submitted as a result of the inducement are false claims Result: $7.9 Million settlement Medicare False Billing Case Lesson Learned: Review all benefit programs to beneficiaries Ensure proper controls are in place Always ask, What if? 10
Questions? Darrell W. Contreras, Esq., LHRM, CHC-F, CHPC, CHRC Partner Phone: (863) 797-9917 e-mail: darrell@jdhcp.net 11