340B Audit Experience

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340B Audit Experience

• Todd Karpinski, PharmD, MS, FASHP
• Chief Pharmacy Officer
• Froedtert Medical College of Wisconsin

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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

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Froedtert Hospital

• 550 bed academic medical center
• 24,000 annual admissions
• gt140,000 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
• gt220 Pharmacy FTEs
• Administration, Pharmacists, Technicians, EPIC
  team

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How do we support the intent of the 340B program?
Froedtert Hospitals 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 Milwaukees
underserved, urban population.

• The Setting
• U.S. 2010 Census Milwaukee is 4 in poverty
  among the nations 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 FQHCs 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

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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)

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Froedtert Hospital 340B Timeline
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Contract Pharmacy - Background

• On September 5th, 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

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Contract Pharmacy - Reinvest

• Inventory compliance technician
• Patient assistance programs
• Indigent care fund
• Ambulatory care pharmacists dedicated to
  transitions of care

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Notification of the Audit

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

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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

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What did we do to prepare?

1. Apexus Self-Assessment Gap Analysis

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What did we do to prepare?

• Identified Gaps and divided workload
• Created stoplight report to establish deadlines
  and track progress

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Data Request

• Eight unique data elements were requested
• Policies and procedures
• Purchasing, Ordering, Invoice Processing,
  Inventory, 340B replenishment, Medicaid billing,
  contract pharmacy
• Froedtert Hospitals Medicare Cost Report
• 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
• Contact with the State Medicaid Prescription Drug
  Program
• Listing of providers eligible to write 340B
  prescriptions
• Current 340B pharmaceutical inventory listing
  including the most recent physical inventory
  count and reconciliation
• Report of all 340B drug purchase orders made
  between January 1, 2012 and June 30, 2012,
  including price paid
• Listing of contract pharmacies utilized, and the
  current contracts
• Submitted data within one week of receiving the
  request

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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

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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

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The Audit Day 2

• HOD Orders (35 total)

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The Audit Day 2

• Contract Pharmacy questions
• Central Pharmacy Tour
• Duplicate Discounts Medicaid
• Policy / Procedure Review
• Provider Eligibility
• Outstanding Items

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Days After the Visit
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Final Report from HRSA
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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

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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

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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

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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

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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

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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

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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

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How do we Maintain Compliance with Contract
Pharmacy???

• Audit 1 Patient Eligibility
• From the vendors 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

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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

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Hot button 340B issues

• GPO exclusion
• Continued Audit preparedness
• Employee prescriptions
• Contract pharmacy

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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

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Questions?