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Timely Refill Request in Pharmacy Billing?

It is well known in the medical billing & coding industry that waste, abuse and fraud may occur due to errors in documentation or even intentionally to generate revenues. Recent incidences in the pharmacy billing sector has led to stepping up vigilance and there has thus been a decrease in revenues due to lack of awareness in knowledge of the domain and rules & regulations. This could partially be due to untrained staff unknowingly documenting wrong information which is then carried over into the billing and coding section leading to wrongly billed information without recheck or determining cause.

However, Pharmacists have always been seen to represent an exceptional line of defence against fraud, waste, and abuse. Their value in helping keep costs down and improving healthcare has recently opened opportunities for them as they have now been recognized as “healthcare providers”. Pharmacists may help uncover unnecessary costs to the Medicaid system when a closer look at billing practices that include billing units, refill practices, overrides, partial fill procedures, package size selection, and proof of delivery documentation is checked.

This is not to say that the risk for fraud, waste, or abuse among pharmacy staff members may not happen. For example, what if one bills for the entire prescribed quantity but dispenses a partial supply while waiting for additional stock to be delivered? Here is a potential for fraud, as the pharmacy may receive reimbursement to which it was not entitled. Reason being – the pharmacy may bill and receive reimbursement for a complete fill and “owe” the beneficiary the remainder of the fill, but the beneficiary may not pick up the owed portion, or the pharmacy may not be able to obtain additional supply of the medication. Moreover, it could also happen that the medication is returned to stock, then the pharmacy inventory turns to be inaccurate, and Medicaid has thus overpaid the pharmacy! Such a situation was an OIG investigation and related to $25 million in overpayments by Medicare Part D for Schedule II prescriptions partial fill completions billed as refills. This usually can happen in hospital based pharmacies. In addition, pharmacies may create partial fill claims as a means to generate a second dispensing fee. Moreover, an excess of partial fills also has the potential to trigger an audit.

So it is very crucial for most pharmacies to implement a sound timely refill and/or partial-fill protocol, including proper documentation, to avoid accusations of partially filling or refill too soon prescriptions in an effort to generate dispensing fee revenue.

  • Follow the proper Refill code:
    • Enter the sequentially assigned two digit number where 0 represents the original dispense and 1 – 99 represents subsequent refills on the same Prescription Number. If this field is left blank, the form will be returned unprocessed.
  • Certain situations where claims can be rejected like Refill Too Soon, Quantity, Days’ Supply, Precertification, Drug Not Covered, Non-Formulary Drug, certain actions need to be taken.
    • If the previous prescription was never filled or picked up, then the claim should be reversed quickly to avoid claim reject. The patient should be advised that in case 75% of the previous prescription has not been used, it is too early to fill and they should return on the appropriate day as determined.
    • If an early refill is due to a dosage increase/adjustment, the Participant needs a vacation supply, or the days supply on the original prescription was entered incorrectly: Pre authorization is required.
    • Claim Rejects Due To Quantity or Days’ Supply: The standard retail pharmacy benefit allows up to a 30-day supply of medication (not to exceed 180 tabs/caps) to be dispensed. If an override is needed to exceed the standard quantity per month, providing “medical necessity” should be established. For example under the Colorado rules- For DEA Schedule 2 through 5 drugs, 85% of the days’ supply of the last fill must lapse before a drug can be filled again. For non-scheduled drugs, 75% of the days’ supply of the last fill must lapse before a drug can be filled again. If the appropriate numbers of days have not lapsed, the claim will be denied as a refill too-soon unless there has been a change in the dosing.

Thus, refill too soon or too early can cause a pharmacy to have its claim rejected and thus lose revenue. Also knowing state or federal rules and regulations especially if the patient is from another state is very crucial when refilling prescriptions and caution needs to be maintained. Hence it is very much essential to the Revenue Cycle Management (RCM) process to maintain timely refill, so as not to lose out on revenue nor be caught on the back foot for waste, abuse or fraud. Outsourcing this administrative part to trained medical billers and coders, who can recheck the documentation before billing and cross check their records will help maintain compliance and provide a win-win situation.