PART 3 of a 3-PART SERIES on Revenue Integrity
As medication prices continue to rise and payor billing and reimbursement requirements become increasingly variable and complex, pharmacy departments have a growing incentive to take responsibility for managing the pharmacy-specific revenue cycle. Given the intricacies of pharmacy billing, charge compliance, and reimbursement structure, this ownership serves as a critical means of minimizing revenue leakage and optimizing revenue capture for both the pharmacy department and the institution, as pharmacy revenue is often a significant driver of institutional revenue.
In 2017, the University of North Carolina (UNC) Medical Center pharmacy department began expanding outreach of the Pharmacy Revenue Integrity (PRI) team from focusing predominantly on denials to assuming comprehensive accountability for the entire pharmacy revenue cycle. The role of the pharmacist on this team was discussed in Part 1 of this series.1 This article focuses on the revenue integrity responsibilities of additional members of the team, including reimbursement analysts and charge integrity analysts. Key responsibilities of these team members include the following:
The PRI team is dynamic, and responsibilities are built in response to case situations as they arise. As the team grows in reach and experience, it is becoming increasingly focused, yet flexible. While a service-building approach has been effective for our institution, it also is highly adaptable to other institutions that may, for example, need to focus on only one of these areas.
Medication Charge Integrity
Pharmacy Charge Description Master Ownership
Proper management of the Charge Description Master (CDM), ie, the list of billable items within a health care institution, including drugs as well as non-medication billable items, can significantly impact medication charge integrity. Typically, an institutional charge master group is responsible for the integrity of the CDM. At UNC Medical Center, the department of pharmacy has historically maintained responsibility for the pharmacy-specific portions of the CDM as it relates to the build of new drugs within the EHR. However, the expanded focus of the PRI team has brought a greater degree of pharmacy-specific CDM scrutiny, and the team has assumed responsibility beyond new medication builds. Current activities include quarterly Healthcare Common Procedure Coding System (HCPCS) updates; this ensures that new drug HCPCS codes are included on claims, and allows for the routine review and update of other reimbursement issues.
For example, the Centers for Medicare and Medicaid Services (CMS) makes quarterly updates to drug HCPCS status indicators, such as moving a product from a status K to a status G, meaning the drug can avoid the discounted reimbursement associated with medications acquired via the 340B program. To indicate to a payor that a drug was acquired at the 340B price and is subject to the decreased reimbursement (ie, status K), the provider applies the JG modifier to the HCPCS code on the drug line of the claim. As such, when a drug status indicator changes from a K to a G, the institution no longer needs to place the JG modifier on the claim. Since Medicare Advantage programs may experience delays in updating their systems following quarterly updates, institutions should apply the status indicator update in the institution’s system in a timely fashion, effectively removing the placement of the JG modifier and effecting accurate reimbursement.
Recently, a PRI reimbursement analyst responsible for monitoring these quarterly updates noted that the April 1st, 2019 update included a change from status K to status G for three colony stimulating factor biosimilar products (pegfilgrastim-jmdb [Fulphila], pegfilgrastim-cbqv [Udenyca], and filgrastim-aafi [Nivestym]). The analyst confirmed that the status indicator update was effective on the CDM on April 1st, allowing for the higher reimbursement for these three products starting at the earliest possible date.
An analyst also recently noticed that a new biosimilar medication was set up in the CDM to mirror the innovator product, despite the fact that the two products have different billing units. This error resulted in significant under-billing—by >90%—for the biosimilar product (see details in the TABLE), since the claims were being sent out with one billing unit rather than the 12 billing units that reflected the actual dose administered. The resulting correction led to the appropriately increased reimbursement for those payors who reimburse these claims on a per-unit basis (eg, Medicare, and typically, Medicare Advantage).
Medication List Maintenance
In addition to CDM setup, the PRI team is engaged in monthly maintenance of EHR medication lists. As a growing number of payors are requiring the inclusion of National Drug Codes (NDCs) on medical benefit claims, UNC Medical Center has noted an increase in the volume of NDC-related denials, particularly with respect to our state Medicaid program. This prompted a focused review of inactive and deleted NDCs and removal of these NDCs from our active medication lists.
Following this change, the denial volume and dollars associated with Medicaid NDC-related denials dramatically decreased, by 75% and 84%, respectively. This undertaking also improved interactions throughout the pharmacy supply chain, allowing UNC Medical Center to adjust procured product to better align with what Medicaid deems reimbursable.
Revenue Protection Strategies
Reimbursement analysts engage in a number of targeted pre-bill auditing activities, focusing on specific high-dollar or error-prone medications. One area of focus is the annual list CMS publishes of items eligible for new technology add-on payments and the claim requirements to ensure this additional reimbursement. Team analysts are responsible for maintaining relevant knowledge of these types of additional reimbursement, and they routinely evaluate charges for drugs eligible for new technology add-on payments. This facilitates identification of items that were improperly billed to drive the additional reimbursement, and prompts operational adjustments.
A recent example applies to the new technology add-on payment for meropenem and vaborbactam (Vabomere), which requires that the NDC be included on the claim. A PRI reimbursement analyst, having identified that these claims did not include the NDC, is now actively working with hospital billing and patient financial services personnel to ensure that the NDC is systematically included on the claims, which will ensure appropriate reimbursement.
The team has also recently drawn attention to the fact that the state Medicaid program will reimburse at a higher Diagnosis Related Group (DRG) weight for placement of long-acting reversible contraception (LARC) following vaginal or cesarean delivery, when compared to the DRG weight for a delivery without LARC placement. However, the higher DRG weight is applied only if both the LARC placement procedure code and the LARC HCPCS code are included on the claim, a step that was not occurring at our institution, since drug HCPCS codes are not typically billed on inpatient claims. A PRI reimbursement analyst, having noted this fact in a Medicaid bulletin, initiated a multi-disciplinary collaboration to alter the way these claims are handled before submission to Medicaid to ensure the requirements are met for the increased reimbursement. In addition to the higher DRG weight driving increased claim reimbursement, adjusting the claim to this format also allows the cost of the LARC to be reimbursed, albeit via the quarterly reconciliation with the institution, rather than through the individual claim reimbursement process.
The PRI team reimbursement analysts conduct targeted reimbursement audits, again focusing on specific high-dollar or error-prone medications. For example, a reimbursement analyst follows all nusinersen (Spinraza) claims to ensure appropriate reimbursement. When the remittance received varies from the expected reimbursement, the analyst works with the patient financial services group and the payor to guarantee that any errors are rectified. This process has resulted in identification of several hundred thousand dollars in underpaid or denied claims. It also led to the early discovery of a global, institution-wide overpayment issue with one payor, which allowed the team to escalate the issue to the institutional managed care team for prompt resolution.
Similarly, a reimbursement analyst monitors all blood factor reimbursements, collaborating with relevant parties to correct errors when they occur. Through this oversight, an analyst recently discovered an inpatient workers’ compensation claim that had not been billed with the blood factor HCPCS as a separate line item. Since North Carolina workers’ compensation reimburses in a manner similar to Medicare, the blood factor HCPCS must be listed as a separate line item to trigger the blood factor add-on payment. The analyst worked with our patient financial services and managed care groups to raise awareness of the oversight in the claims logic, and a new claim was generated, which should result in over $100,000 in additional reimbursement. This situation also prompted a global adjustment to institutional claims logic to avoid this error in the future.
Analysts also engage in reimbursement monitoring for targeted, high-dollar drugs that may be administered in the inpatient environment. The goal is to identify DRG-driven reimbursement that may not appropriately cover the cost of the drug, especially if the total charges are not high enough to reach the threshold for a cost outlier payment. This monitoring is currently utilized for eculizumab (Soliris). Prior to daunorubicin and cytarabine (Vyxeos) becoming eligible for the new technology add-on payment, its reimbursement was also monitored under the ad-hoc inpatient monitoring program. Part of the monitoring process includes discussions with clinical teams, with consideration given to adjusting clinical pathways where appropriate, for example, restricting drug use to the outpatient environment.
Relationship-Building with Non-Pharmacy Personnel
Patient Financial Services
Outside of the pharmacy, the PRI team’s strongest relationships are with patient financial services, as they are responsible for the accounts receivable aspect of claims. This collaboration ensures a consistent approach to payor interactions across both the PRI and patient financial services teams. Strengthening these relationships has resulted in improved payor interactions and increasingly optimized drug reimbursement. For example, the PRI team, with assistance from patient financial services, recently worked directly with a payor representative to arrange medical director discussions that have ultimately resulted in over $130,000 in reimbursement for previously denied claims.
The PRI team regularly interacts with the hospital billing team, primarily to address pre-claim logic related to high-dose edits (ie, medically unlikely edits) that stop claims prior to the bill being sent to the payor. Through these interactions, pharmacy is able to guide decisions related to either billing the higher doses (with the intention of appealing the resulting denials) or adjusting down to the established CMS dose limit. Hospital billing team interactions also support the sharing of important information, such as comprehensive HCPCS update lists.
When payor issues are identified that cannot be resolved with PRI-payor provider representative interactions, the managed care department can serve as an additional mediator to drive favorable outcomes. The PRI team has also been asked to provide payor-specific feedback to the managed care group when they are involved in contract negotiations, as a means of driving future beneficial change.
Non-Pharmacy Clinical Teams
The UNC Medical Center has a long history of collaboration between pharmacy and the other members of the clinical team. The pharmacy-centric PRI team often benefits from the existing healthy relationships with non-pharmacy clinical teams. Where these relationships do not already exist, the PRI pharmacist acts as a conduit to establish collaborative contacts. The PRI team’s interactions with non-pharmacy clinical teams provide frontline transparency in denial situations that require adjustment either to global practices, or for patient-specific scenarios.
For example, the PRI team recently identified a global issue in a series of Medicare infusion denials related to patients not being seen routinely by the prescriber. In response, the team collaborated with the clinic nurse navigators to ensure that patients are seen routinely enough to avoid the denials. An example within the patient-specific realm relates to repeated denials due to a lack of IVIG authorization for a patient receiving the drug through recurring medical intensive care unit extended recovery stays. The extended recovery admission is similar to an observation admission in that it is considered by payors to be an outpatient visit, making it subject to the outpatient drug authorization requirements. With the help of nurse navigators in the clinic, The PRI team routed IVIG orders through our precertification team for prior authorization, a process that does not typically occur for a traditional inpatient admission.
The pharmacy revenue cycle’s highly variable, complex intricacies are best navigated by a pharmacy-focused team with the specialized expertise to drive positive outcomes. There are countless ways in which such dedicated teams can contribute to pharmacy and institutional efforts to minimize revenue loss while optimizing revenue capture. Putting these practices into use can significantly impact reimbursement and help prevent denials.
Suzanne J. Francart, PharmD, BCPS, is the assistant director of pharmacy for the medication assistance program and pharmacy revenue integrity at the UNC Medical Center. She earned her Doctor of Pharmacy from the Virginia Commonwealth University School of Pharmacy, then completed a PGY1 general practice residency and PGY2 pharmacotherapy specialty residency at UNC Hospitals. Suzanne’s professional interests include ensuring patient drug access and institutional financial stewardship.
Lindsey B. Amerine, PharmD, MS, BCPS, is the interim regional director of pharmacy at the UNC Medical Center and 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. She 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.
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