Audit Preparedness in Long-Term Care Claims: Implementing Proactive Measures

The practice of LTC pharmacy is different – look no farther than the dichotomy between prescriptions and orders. While state laws may be vague or unclear, resulting in pharmacists using professional judgement, PBMs have their own requirements. Do PBM Provider Manuals (and auditors) view LTC differently? The answer may surprise you—not as much as one may think and following the “LTC is different” mindset may lead to a lot of extra work (or recoupments) if you find yourself with an audit. Insufficient documentation for Long-Term Care (LTC) prescription claims is a topic PAAS National® analysts cover frequently during audit preparation consultations with members operating combo shop pharmacies and/or closed door LTC pharmacies. Our analysts are experts in understanding the documentation requirements for both retail and LTC claims and want you to be comfortable and confident in your documentation as well. One reference tool the PAAS analyst will utilize when educating pharmacies …

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is the publicly available Humana Guidelines for LTC. As found in the Humana reference, pharmacies should be prepared to provide the following information for LTC claims (which can be applied broadly to most PBMs):

  1. Prescription hardcopy requirements
    1. Patient name
    2. Date of issuance
    3. Name of the drug
    4. Strength of the drug
    5. Dosage form of the drug (if applicable)
    6. Directions for use
    7. Documented duration of therapy (e.g., number of refills, clear start and stop dates, duration of therapy written by prescriber)
    8. Prescriber’s DEA number (if applicable)
    9. Prescriber’s printed name and signature
  2. Signature log requirements
    1. Patient name
    2. Date of service
    3. Prescription number(s)
    4. Facility name
    5. Date of delivery to facility (handwritten)
    6. Signature of individual who accepted delivery at the facility

Apart from the facility name and the small nuances with duration of therapy, the elements above should look very familiar as they are the same elements prescriptions for retail claims should have. Other similarities between retail and LTC requirements include:

  • Must dispense within the PBM’s return to stock window
  • Must not delivery prior to billing
  • Must have appropriate documentation for override codes utilized for successful claim adjudication
  • The 11-digit NDC billed must match all 11 digits of the NDC dispensed
  • Proof of copay collection (or attempts to collect) is required
  • The directions must be specific to allow for the days’ supply to be mathematically calculated and accurately billed (following the Can You Bill It as 30 Days?, where applicable)

While daily operations and workflow in a closed-door LTC pharmacy may be vastly different from that of a retail pharmacy, the pharmacy still has the same requirement to provide proof of a valid prescription, proof of dispensing, proof of copay collection, and proof of sufficient inventory. Failing to have sufficient documentation could mean claim recoupment, accusations of fraud, waste, or abuse, and (potentially) contract termination.

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Sara Hathaway, PharmD
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