Pharmacy audits, pharmacy benefit manager registration, and related penalties
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State law (Florida HB 357) governing rights of pharmacies during audits conducted by insurers, PBMs, and related entities; appeal rights; insurer responsibility when obligations are transferred to PBMs; and a registration penalty for PBMs. Affects pharmacies, health insurers/HMOs, and PBMs operating in Florida.
Section 465.1885 is transferred and renumbered as section 624.491 and amended to specify pharmacy audit rights and procedures.
A new subsection (6) to section 624.490 imposes a $10,000 fine for operating as a PBM without registering with the office.
Pharmacy Audit Rights and Responsibilities
Pharmacy audit rights, exceptions, appeals, insurer responsibility, and PBM registration penalty
Pharmacy rights and audit procedures required when an entity audits a pharmacy's records, with specified exceptions, appeal rights, insurer responsibility, and a PBM registration penalty.
ALL of the following
ALL of the following
- Provide at least 7 calendar days notice before the initial onsite audit for each audit cycle.
Except as provided in subsection (3).
- Do not schedule an onsite audit during the first 3 calendar days of a month unless the pharmacist consents otherwise.
ALL of the following
- Limit the audit lookback/audit period to 24 months after the date a claim is submitted to or adjudicated by the entity.
- When an audit requires clinical or professional judgment, conduct the audit in consultation with, or allow the audit to be conducted by, a pharmacist.
- Allow the pharmacy to use written and verifiable records of a hospital, physician, or other authorized practitioner transmitted by any means to validate pharmacy records in accordance with state and federal law.
ALL of the following
- Reimburse the pharmacy for a claim retroactively denied due to a clerical, typographical, scrivener's, or computer error if the prescription was properly and correctly dispensed, unless a pattern of such errors exists, fraudulent billing is alleged, or the error results in actual financial loss to the entity.
- Calculate any recoupment or penalties based on actual overpayments and not by extrapolation accounting practices.
ALL of the following
- Provide the preliminary audit report within 120 days after the conclusion of the audit.
- Allow the pharmacy 10 business days to produce documentation to address a discrepancy or audit finding after delivery of the preliminary audit report.
- Provide the final audit report within 6 months after the pharmacy's receipt of the preliminary audit report.
ANY of the following
- Audits in which suspected fraudulent activity or other intentional or willful misrepresentation is evidenced by physical review, review of claims data or statements, or other investigative methods.
- Audits of claims paid for by federally funded programs.
- Concurrent reviews or desk audits that occur within 3 business days after transmission of a claim where no chargeback or recoupment is demanded.
ALL of the following
- An entity auditing a pharmacy located within a Health Care Fraud Prevention and Enforcement Action Team (HEAT) Task Force area may dispense with the notice requirement of at least 7 calendar days if the pharmacy has been a member of a credentialed provider network for less than 12 months.
ALL of the following
- After receipt of the final audit report, a pharmacy may appeal the findings as to whether a claim payment is due and as to the amount of a claim payment, pursuant to s. 408.7057.
ALL of the following
- A health insurer or health maintenance organization that transfers to a pharmacy benefit manager the obligation to pay a pharmacy remains responsible for a violation of this section.
ALL of the following
- A person who fails to register with the office while operating as a pharmacy benefit manager is subject to a fine of $10,000 for each violation.
Audit Timing, Lookback, and Code References
Audit Notice and Provider Requirements
Provide ≥7 calendar days' notice before initial onsite audit
Pharmacies must receive advance notice before an initial onsite audit. The entity conducting the audit must notify the pharmacy at least 7 calendar days before the initial onsite audit for each audit cycle.
- Applies to audits conducted directly or indirectly by a managed care company, insurance company, third-party payor, pharmacy benefit manager, or an entity that represents responsible parties.
Defined Terms
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