This article, which discusses the role of the pharmacist in ensuring revenue integrity, is Part 1 of a 3-Part series on financial management in the pharmacy. Parts 2 and 3, which will cover strategies for precertification and revenue cycle charge integrity, respectively, will appear in future issues of Pharmacy Purchasing & Products.
There is no doubt that the number of exceptionally high-cost drug therapies has significantly increased in US health systems in recent years. In conjunction with this increase, since the early 2000s contracting relationships among health systems, drug manufacturers, and insurers have increased in complexity. Policy changes, such as the requirement for National Drug Codes (NDCs) on states’ Medicaid claims and changes in Medicare charge codes, require continuous monitoring. To properly manage these changes in the health care reimbursement sector, interdepartmental communication, logistics, collaboration, and a robust approach to combat revenue leakage, or missed revenue, are crucial.
Revenue leakage can be calculated using the amount of revenue a health system should be charging, the expected contract reimbursement from payors, and the amount of reimbursement eventually received. Missed revenue can occur for a variety of reasons, including inaccurate pricing, coding, charging, or documentation, as well as inadequate reimbursement resulting from payor denials or errors. To ensure revenue integrity, health systems must have a comprehensive process in place which minimizes revenue leakage.
In an effort to decrease revenue leakage, the University of North Carolina (UNC) Medical Center Department of Pharmacy launched an initiative in 2016 to identify and address denials through the creation of a Pharmacy Revenue Integrity team. Prior to the implementation of the team, reimbursement had been handled by the hospital’s billing department. Because the billing department did not have the specialized training of a diverse, pharmacy-centric team, millions of outpatient drug charges alone were being written off each year without any pharmacy consultation. Multiple reasons were cited for these write-offs, including:
- A lack of proper claim documentation
- Missing or invalid authorization
Since 2016, the Pharmacy Revenue Integrity team has expanded to address a variety of revenue leakage concerns. In its current state, the team comprises a pharmacist, a denials specialist, two reimbursement analysts, and a charge integrity analyst, all of whom report to an associate director in pharmacy. As organizations endeavor to implement revenue integrity teams, it is important to highlight the value a pharmacist brings to the group. The CASE STUDY below demonstrates the unique advantages a pharmacist delivers to revenue integrity efforts.
The Role of the Pharmacist
Navigating the complex issues surrounding denials requires the clinical expertise of a pharmacist. For example, the Pharmacy Revenue Integrity team must understand the intricacies of disease states, drug therapies, national guidelines, relevant clinical trials, and pharmacy and health system operations. The UNC Medical Center Pharmacy Revenue Integrity team’s pharmacist reviews payors’ medical policies, which change frequently and are often difficult to locate. Clinical experience is critical to facilitating comparison of payor coverage criteria to patient-specific medical history, which increases thesuccess in crafting a strong clinical argument to garner reimbursement for a drug therapy.
For Medicare claims, the pharmacist evaluates patient medical histories in relation to the Medicare National Coverage Determinations (NCDs) and the regional Medicare Administrative Contractor’s (MAC) Local Coverage Determinations (LCDs). The NCDs and LCDs detail medical necessity requirements related to medication therapies and/or disease states. Because Medicare does not grant prior authorizations for medications covered outside of the Part D plan, denials must be appealed individually for each specific date of service; this appeals process requires crafting strong clinical arguments to support the medical necessity of the drug therapy. In the event that a Medicare provider believes there is sufficient evidence to modify an LCD, the provider can submit an extensive, well-referenced, non-patient specific letter to the regional MAC, requesting to amend the LCD. A pharmacist is responsible for crafting this letter.
The pharmacist on the UNC Medical Center Pharmacy Revenue Integrity team has successfully appealed to the regional MAC to amend LCDs, which is the only way to positively affect more than one date of service at a time; in addition, it preserves revenue integrity for future patients in similar clinical situations.
The Importance of Collaboration
An article published in Pharmacy Purchasing & Products in 2017 by Tara L. Hanuscak, PharmD, MS,1 notes many of the positive roles a pharmacist plays on a revenue integrity team: Communicator, problem solver, project manager, and compassionate sponsor, all strengths that a pharmacist traditionally embodies through self-selection of the field and as a result of their training. One of the values the pharmacist brings to this team is the ability to collaborate and communicate effectively with other cost centers in the pharmacy department and with the various stakeholders throughout the revenue cycle.
The Pharmacy Revenue Integrity team pharmacist meets regularly with multiple pharmacy operations area managers to explain the revenue cycle, share identified gaps and opportunities, and brainstorm quality improvement processes. The pharmacist’s goal is to drive front-end change through mutual trust, open communication, and teamwork. Through various revenue integrity projects, as well as routine collaboration, the pharmacist has also developed relationships with non-pharmacy personnel, interacting regularly with prescribers, patient financial services representatives, the hospital billing group, care management, pre-arrivals, managed care, and other revenue cycle team members. These recurring interactions facilitate bilateral communication surrounding policy changes and development of best practices within the revenue integrity realm.
Since implementation of the Pharmacy Revenue Integrity team, multidisciplinary awareness of the pharmacy revenue cycle and of the important mandate to comprehensively address revenue leakage has significantly increased at the UNC Medical Center, largely due to the pharmacist’s influential presence. In this role, the pharmacist can provide the clinical expertise necessary for appeals and collaborate with other departments to significantly impact revenue cycle management.
- Hanuscak T. Building a Pharmacy Revenue Integrity Team. Pharm Purch Prod. 2017;14(5):20-24.
Mary G. Petrovskis, PharmD, MS, BCPS, is the pharmacy manager for inpatient operations and controlled substances at University of North Carolina (UNC) Rex Hospital. She earned her Doctor of Pharmacy from The Ohio State University College of Pharmacy and her MS with an emphasis in health-system pharmacy administration from the UNC Eshelman School of Pharmacy while completing a 2-year health system pharmacy administration residency at UNC Hospitals.
Caron Misita, PharmD, BCPS, is the lead pharmacist for the pharmacy revenue integrity team at the UNC Medical Center. She earned her Doctor of Pharmacy degree from Samford University’s McWhorter School of Pharmacy in Birmingham, Alabama, and completed a Primary Care Specialty Residency at UNC Hospitals. Caron has practiced in a number of settings, including as a clinical pharmacist practitioner in various clinic environments and as a clinical manager. She has also served as a preceptor for pharmacy students and residents on clinical rotations and as a program director for multiple PGY2 residency programs at UNC Hospitals.
Lindsey B. Amerine, PharmD, MS, BCPS, is the associate director of pharmacy for infusion services, investigational drug services, medication assistance program, pharmacy revenue integrity, and WakeBrook Hospital at the UNC Medical Center. She is an associate professor of clinical education for the division of practice advancement and clinical education at the UNC Eshelman School of Pharmacy in Chapel Hill, North Carolina. Lindsey earned her Doctor of Pharmacy from the University of Wyoming School of Pharmacy and her MS with an emphasis in health-system pharmacy administration from the UNC Eshelman School of Pharmacy while completing a 2-year health system pharmacy administration residency at UNC Hospitals.
The Value of a Pharmacist on Revenue Integrity
The Pharmacy Revenue Integrity team received a panitumumab denial for use in a patient with rectal cancer. The pharmacist compared the patient’s history to National Comprehensive Cancer Network guidelines for rectal cancer therapy and crafted and submitted an evidence-based appeal letter with supporting documentation. The subsequent payer response noted that the appeal had been clinically reviewed and the denial upheld, citing that the therapy was not consistent with colon cancer guidelines. This statement is accurate, but the patient in question has rectal cancer, not colon cancer (ie, the reviewer had compared the patient’s therapy to the wrong set of guidelines). The pharmacist escalated the issue to individuals within UNC Medical Center Managed Care and Revenue Cycle teams before a favorable response was received from the payer. Ultimately, the pharmacist’s clinical background, historical collaboration and relationship-building, and months of persistence resulted in $200,000 in line item drug reimbursement over the multiple dates of service. This example is one of many that demonstrate the value of a pharmacist as an integral member of the Pharmacy Revenue Integrity team.