Tips for Tackling PBM Audits—Together

Drug Topics JournalDrug Topics December 2022
Volume 166
Issue 12

Working collaboratively can be key to either avoiding a PBM audit altogether or making the process as painless as possible.

They nearly always cost pharmacies money and require a lot of work to complete, but pharmacy benefit manager (PBM) audits are an unfortunate fact of life. At the National Community Pharmacists Association 2022 Annual Convention & Expo, presenters shared their insights into how pharmacists can tackle these audits in the most effective way possible.

Curious why audits happen? It’s as simple as rising health care costs and improvements in data analytics that find outliers more easily, according to Dana Westberg, CPhT, analyist at Pharmacy Audit Assistance Service (PAAS), to say nothing of the revenue generated by them, as one of the most common penalties is financial recovery. Bad actors also make PBM audits necessary: Westberg cited 2 cases, one involving a pharmacy in Texas that had $10 million in dispensing expenses and another involving pharmacy owner/accountant who was indicted for a $1.5 million scam.

Trent Thiede, PharmD, MBA, PAAS president, cited his own examples of bad actors, including one case of a pharmacist who billed products that were never dispensed over a period of time that netted $7.2 million, another about a group of ghost pharmacies in Miami that billed for products for pharmacies that did not exist, purchased no prescription drugs, had no real customers, and performed no actual pharmacy business.

Those bad actors have led to a 50% increase in audits over 5 years. Desktop audits remain the most common form. Onsite audits decreased with the onset of COVID-19, but were replaced by virtual audits, which “tend to be very large, very time consuming and you also have a phone interview with the auditor,” according to Westberg.

Westberg shared 4 strategy elements to prevent audits, which include:

  • Prescription: Ensuring that there is a prescription and that it meets the requirements of the state and federal government.
  • Data entry and filling: Checking that this information was filled out correctly and accurately.
  • Dispensing: Capable of showing proof of both dispending and collected copay
  • Invoice: Confirming that enough inventory has been purchased from appropriate sources

According to Westberg, common audit discrepancies included prescriptions that were missing elements, transferred prescriptions lacking transfer elements, overfilling prescriptions, filling refills too soon, and dispensing outside of a return to stock. She noted that although many pharmacies operate on a 14-day return to stock policy across the board that some PBMs have moved to a 10-day standard.

Implementing workflow strategies as a key part of the dispensing process can be a good way to make an audit easier and can include:

  • Dropoff: Staff should be trained on alterations that can be made to prescriptions such the date or quantity. They should check directions; are they vague, or do they say “Use as directed”? When clarification is required, staff should document with a clinical notation, the name and title of the person they spoke with, the date and time of the call, what the conversation was about, and the initials of the staff member.
  • Data entry: Staff should make sure the correct National Council for Prescription Drug Programs billing unit is included on the claim. Check that the day supply has been calculated according to quantity and directions. Many pharmacies rely on what comes through eScript, but this is often inaccurate.
  • Filling: Staff should match the 11-digit National Drug Code code found on the bottle against the billing label. A barcode scanning system can simplify this process immensely.
  • Cashier: Staff should make sure that they are getting the patient’s signature at the time of dispense. If the prescription is being mailed, find the tracking information and link it to the prescription number itself; PBMs will want to know what was in a delivered package. Make sure that copays and proof of the copay are collected. In cases of an in-house charge account, a strong written standard operating procedure on account handling is imperative. Staff should stay on top of return to stock, as these can be easy pickings for PBM.

When the subject of a PBM audit, many owners choose to take on the audit themselves and not involve staff. For Westberg this may not be the best idea, it can leave staff in the dark about what drugs can trip an audit and the consequences of an audit. “A lot of your staff may not be aware of that. And by sharing this information [it] really may change how they're doing their job.”

Drug Topics’ coverage of the 2022 NCPA Annual Convention and Expo is sponsored Prescryptive Health.


  1. Thiede T, Westberg D. Tackling PBM audits collaboratively. Presented at: National Community Pharmacists Association 2022 Annual Convention; October 1-4, 2022; Kansas City, MO.

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