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340B Audit Experience Todd Karpinski, PharmD, MS, FASHP Chief Pharmacy Officer Froedtert & Medical College of Wisconsin.

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Presentation on theme: "340B Audit Experience Todd Karpinski, PharmD, MS, FASHP Chief Pharmacy Officer Froedtert & Medical College of Wisconsin."— Presentation transcript:

1 340B Audit Experience Todd Karpinski, PharmD, MS, FASHP Chief Pharmacy Officer Froedtert & Medical College of Wisconsin

2 Objectives Outline the preparatory process for the 340B HRSA audit Discuss the two day, on-site visit: –Areas of focus –Discussion points during the audit process –Issues identified during the audit –Recommendations from the auditors Provide “tips” and “lessons learned” from the overall audit process

3 Froedtert Hospital 550 bed academic medical center 24,000 annual admissions >140,000 patient days Disproportionate share hospital –17.25% (FY2012) Affiliated with Medical College of Wisconsin Only Level I trauma center in Southeastern Wisconsin Major referral center: 40 specialties and subspecialties >220 Pharmacy FTE’s Administration, Pharmacists, Technicians, EPIC® team

4 How do we support the intent of the 340B program? Froedtert Hospital’s community benefit framework is to improve the quality of life in the communities we serve through health care programs and services that are measureable, accessible and culturally appropriate; recognizing the greatest impact is in Milwaukee’s underserved, urban population. The Setting: U.S. 2010 Census: Milwaukee is #4 in poverty among the nation’s cities In Milwaukee County, 30% are on Medicaid and 15% are uninsured Our Investments in 2011: $34 million uncompensated care $41 million in government shortfalls Over 10,000 patient accounts adjusted for charity care $400,000 annual support to FQHC’s and a $2 million pledge for capital support Over $58 million in health professions education, including college and high school scholarships / internships for underrepresented students

5 Community Benefit from Pharmacy Charity Care Medication Management Home Delivery Diabetes Smart Start Program Medication Collection Program Sharps Collection Program Medication Repository Discharge Program (implemented 9/2011) Ambulatory Care pharmacists Blood pressure cuffs (Newly Transplanted Patients)

6 Froedtert Hospital 340B Timeline AUDIT

7 Contract Pharmacy - Background On September 5 th, 2010, HRSA published new guidelines stating covered entities would no longer be limited to the number of contract pharmacies. Entities partner with outside pharmacies to connect qualifying patients with 340B medications –Identification via shared patient and provider data –Inventory via "Bill To - Ship To” wholesale arrangements Entity-Contract Pharmacy relationship types : –Direct Contracting with Pharmacy –Contracting through 340B vendor with Pharmacy

8 Contract Pharmacy - Reinvest Inventory compliance technician Patient assistance programs Indigent care fund Ambulatory care pharmacists dedicated to transitions of care

9 Notification of the Audit June 18 th, 2012 - Receive HRSA audit notification via email –Assess compliance of the covered entity 1.Is eligible to participate in the 340B Program 2.Has sold or provided 340B covered drugs to persons who are not eligible patients 3.Has the proper controls in place to prevent and detect instances of diversion and duplicate discounts. –HRSA audit will include (at a minimum) 1.Review of the facility’s policies, procedures and processes that pertain to 340B medications 2.Verification of internal controls in place to prevent diversion and duplicate discounts; 3.Testing, on a sample basis, transactions that pertain to 340B medications.

10 What did we do to prepare? Formed Froedtert Hospital 340B Team: –Legal –Corporate Compliance –Finance Leadership –Pharmacy Leadership Scheduled weekly meetings within pharmacy Reached out to other colleagues/organizations –SNPHA –Other 340B audited institutions –Wholesaler partner –Apexus

11 What did we do to prepare? 1.Apexus Self-Assessment Gap Analysis

12 What did we do to prepare? 2.Identified “Gaps” and divided workload Created stoplight report to establish deadlines and track progress

13 Data Request Eight unique data elements were requested 1.Policies and procedures Purchasing, Ordering, Invoice Processing, Inventory, 340B replenishment, Medicaid billing, contract pharmacy 2.Froedtert Hospital’s Medicare Cost Report 3.340B Drug Orders or Prescriptions Report of all 340B orders/prescriptions issued between 1/1/12 and 6/30/12 Unique identifying number, drug name, acquisition price, quantity, patient id, payer, and provider 4.Contact with the State Medicaid Prescription Drug Program 5.Listing of providers eligible to write 340B prescriptions 6.Current 340B pharmaceutical inventory listing including the most recent physical inventory count and reconciliation 7.Report of all 340B drug purchase orders made between January 1, 2012 and June 30, 2012, including price paid 8.Listing of contract pharmacies utilized, and the current contracts Submitted data within one week of receiving the request

14 The Audit - Day 1 Kick-off meeting –Attendees: Pharmacy, Legal, Corporate Compliance, Finance –Overview of Froedtert Hospital –Review of the audit visit Tour of Pharmacies –Outpatient pharmacies –Day Hospital 65 orders randomly selected for on-site review –5 orders from high cost medications –10 orders from contract pharmacies –20 orders from outpatient pharmacies –30 orders from HOD areas Accumulators Purchasing via Rx Works

15 The Audit – Day 1 Retail/Contract Pharmacy Orders (30 total) –Reviewed specific data fields for each order: Patient eligibility via electronic system? (Epic) –Date of the prescription match the visit date? –Patient have multiple visits? Provider eligibility? –Reference to the Provider list

16 The Audit – Day 2 HOD Orders (35 total)

17 The Audit – Day 2 Contract Pharmacy questions Central Pharmacy Tour Duplicate Discounts – Medicaid Policy / Procedure Review Provider Eligibility Outstanding Items

18 Days After the Visit

19 Final Report from HRSA

20 How do we Maintain Compliance??? In FY2012, one FTE technician was approved to maintain 340B compliance by conducting internal audits –Responsibilities include: Conduct quarterly audits of contract pharmacies Evaluate and implement cost savings opportunities Coordinate purchasing for split inventory within internal pharmacies Conduct self-audits of 340B pharmacy operations on a quarterly basis

21 How do we Maintain Compliance??? Audit 1: Compliance Validation –Confirm presence of all covered entities and accuracy of information; verify contact information including phone and email information, Medicaid exclusion information and ship to / bill to information. This must include signoff by finance and legal. –Completed annually

22 How do we Maintain Compliance??? Audit 2: Prescription Eligibility Review –Review 15 of the most expensive and 10 of the least expensive (penny priced) dispenses within each of the 340B eligible outpatient pharmacies. Review will consist of verifying patient eligibility and provider eligibility. Any variances are corrected and documented on the 340B audit report –Completed daily

23 How do we Maintain Compliance??? Audit 3: Physician Data Base Maintenance –Perform a monthly assessment of the accuracy of the prescriber database to ensure proper designation. Any variances are corrected and documented on the 340B Audit Report. Audit 4: Accumulated Against Purchased (5 drugs) –Verify that the correct quantity is purchased on the 340B accounts based on the quantity that was processed in the accumulator. –Completed monthly

24 How do we Maintain Compliance??? Audit 5: Purchasing Volume Analysis –Purchasing volume for each account is reviewed to ensure purchases have been made on the correct account. Significant changes in purchase volume are reviewed for appropriateness. Any variance are corrected, using credit and rebill if necessary, and documented on the 340B Audit Report. –Monitor WAC / GPO / 340b spend

25 How do we Maintain Compliance??? Audit 6: HOD Mixed Use – ED patients Admitted vs. Not Admitted –Review 25 patients from mixed use areas which the splitting software for 340B drug purchase. Check status to ensure patient status was Outpatient and eligible for 340B purchase. Any variances are corrected and documented on the 340B Audit Report. –Completed monthly

26 How do we Maintain Compliance??? Audit 7: Accumulator vs. Expected – Verify accuracy of NDCs in the accumulator. Compare accumulator expected purchases, actual purchases, wholesaler purchases, and proper account ordering. –Complete monthly

27 How do we Maintain Compliance with Contract Pharmacy??? Audit 1: Patient Eligibility –From the vendor’s report, choose 20 patients to audit. Select patients who are filling the prescription for the first time. Select patients that have multiple first fills prescriptions written by different prescribers. Verify each patient in EPIC to ensure visit was completed by an eligible provider. –Completed daily Audit 2: Hardcopy Prescription Request –Request 20 prescription hardcopies from vendor. Verify patient and provider eligibility. Verify that dispenses were accumulated appropriately. –Completed monthly

28 How do we Maintain Compliance with Contract Pharmacy??? Audit 3: Vendor Prescriber Audit –Evaluate each provider used to dispense 340B eligible prescriptions for inclusion on eligible provider list. Eligibility is based on NPI number. –Updated provider eligibility list is sent each month –Completed monthly

29 Hot button 340B issues GPO exclusion Continued Audit preparedness Employee prescriptions Contract pharmacy

30 Lessons Learned Understand! –Work with national organizations –Network with other covered entities –Utilize internal resources Be proactive! –Review and understand Polices & Procedures –Review audit process with key stakeholders Stay engaged! –Continue to measure and test compliance

31 Questions?


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