Gaining the upper hand on pharmacy benefit fraud, waste and abuse

The National Health Care Anti-Fraud Association estimates that the U.S. health care system loses tens of billions of dollars every year to fraud, waste and abuse (FWA). A large portion of these costs are attributed to pharmacy spend, including duplicate claims, data entry errors, forged prescriptions and intentional overcharging.

Pharmacy FWA can result in misused benefits, safety issues among plan members and unnecessary financial losses for employers and plan members. Even more, policy and regulation changes during the pandemic, such as expanded access to telehealth and waived prescription refill limits, have created new avenues for fraudulent activity. So how can plan sponsors protect their members from these risks?

Related: Fraud, waste and abuse in health care claims: A bad situation worsened by the pandemic

Partnering with a pharmacy benefit manager (PBM) with a holistic FWA program in place or supplementing an existing program with services from an additional PBM partner can improve health care performance, financial results and member safety.

With robust access to pharmacy data, provider prescribing patterns and member claims, PBMs are uniquely positioned to investigate the entire prescribing journey to prevent, detect and address FWA. PBMs can identify opportunities to recover claims, provide education or apply controls to prevent financial loss, improve safety and support claims integrity.

Here are four tools of a holistic FWA program to preserve the integrity of the pharmacy benefit, avoid financial losses and protect plan members from potentially serious and costly harm:

• Pre-payment Claims Review: Innovative algorithms and data analytics can flag claims with suspicious attributes and/or inappropriately submitted claims.
• Pharmacy Audits: Audits help ensure the validity and accuracy of pharmacy claims to identify suspicious patterns.
• Analysis of Industry, Program and Fraud Alerts: Analyzing fraud alerts and memos inform interventions and action plans.
• Pharmacy, Patient and Prescriber Investigations: A Special Investigations Unit (SIU) is an internal investigation unit responsible for conducting investigations of potential fraud, waste and abuse.

Each plan sponsor has a unique set of needs and challenges. By putting data analytics to work and thoroughly investigating reports of FWA, PBMs can create highly tailored solutions for plan sponsors. As FWA patterns evolve during a pandemic, it is more important than ever for plan sponsors to work with a vigilant PBM partner adapting its program to identify and resolve new fraudulent, abusive or wasteful behavior. Strong collaboration between the plan sponsor and PBM can yield the greatest opportunity for avoidance and rapid intervention, ultimately lowering unnecessary costs and effectively managing fraud, waste and abuse.

Carrie Aiken, CHC, is vice president of corporate compliance and chief compliance officer at Navitus Health Solutions. She manages compliance-related work plans and risk assessments and participates in the development of policies and procedures, education, reporting, FDR oversight, risk analysis and mitigation. Carrie seeks to maintain the momentum of Navitus’ current compliance state and to deliver its message to clients, pharmacies and members. She also actively ensures integration between operations and compliance as Navitus grows and new risks emerge.

Read more: 

• Telehealth growth comes with concerns about fraud, patient safety
• How AI can streamline health care claims processing and benefit payers
• Medical providers score billion-dollar win in insurance recovery claims case