CSSB 217(L&C): "An Act establishing procedures and guidelines for auditing pharmacy records; and providing for an effective date."
00 CS FOR SENATE BILL NO. 217(L&C) 01 "An Act establishing procedures and guidelines for auditing pharmacy records; and 02 providing for an effective date." 03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 04 * Section 1. The uncodified law of the State of Alaska is amended by adding a new section 05 to read: 06 INTENT. This Act is intended to establish standards for an audit of pharmacy records 07 carried out by an insurer, a managed care company, a third-party payor, a pharmacy benefits 08 manager, a health plan administered by the state, or any entity that represents those 09 companies. 10 * Sec. 2. AS 08.80 is amended by adding a new section to read: 11 Sec. 08.80.477. Pharmacy audits. (a) When an audit of the records of a 12 pharmacy licensed in this state is conducted by an insurer, managed care company, 13 hospital or medical service corporation, third-party payor, or pharmacy benefits 14 manager,
01 (1) for each audit cycle, the auditor shall provide the pharmacy or 02 pharmacist with notice of the audit at least two weeks before conducting the initial on- 03 site audit; 04 (2) unless the pharmacy and the auditor agree otherwise, the audit may 05 not be scheduled to occur during the first seven business days of a month because of 06 the high volume of prescriptions that are filled during that time; 07 (3) an auditor may not audit more than 75 prescriptions during a single 08 audit; 09 (4) the audit of a claim shall occur within two years after the date the 10 claim was submitted; 11 (5) if the audit involves clinical or professional judgment, the audit 12 must be conducted by or in consultation with a pharmacist licensed in the state; 13 (6) each pharmacy shall be audited using the same standards and 14 parameters as other similarly situated pharmacies; 15 (7) an auditor may not require more stringent record keeping by a 16 pharmacy than is required by state or federal law; 17 (8) a clerical error, record-keeping error, typographical error, or 18 scrivener's error may not be the basis for a finding of fraud; 19 (9) an auditor conducting an audit may only have access to previous 20 audit reports prepared by the auditor for the particular pharmacy being audited; 21 (10) an auditor may provide information only to the person requesting 22 the audit and the pharmacy being audited; 23 (11) an auditor may not use the accounting practice of extrapolation to 24 establish an overpayment or underpayment or for calculating recoupment or penalties; 25 (12) a finding of overpayment or underpayment by the auditor must be 26 based on an actual overpayment or underpayment and may not be based on a 27 projection based on the number of patients served who have a similar diagnosis or on 28 the number of similar orders or refills for similar drugs; 29 (13) an auditor may not assess a charge-back, recoupment, or other 30 penalty against a pharmacy based on a prescription that is mailed or delivered by 31 request of a patient as part of a routine business practice;
01 (14) calculations of overpayments may not include dispensing fees; 02 (15) the preliminary audit report must be delivered to the pharmacy 03 within 60 days after the completion of the audit; 04 (16) a pharmacy shall be allowed at least 30 days following receipt of 05 a preliminary audit report to produce documentation to address a discrepancy found 06 during the audit; a pharmacy may use any record, including the records of a hospital, 07 physician, or other health care provider, documented telephone calls from the 08 prescriber or prescriber's agent, or other written or electronic record to validate a 09 pharmacy record; 10 (17) the insurer, managed care company, hospital or medical service 11 corporation, third-party payor, or pharmacy benefits manager shall establish a written 12 appeal process by which a pharmacy may appeal an unfavorable preliminary or final 13 audit report; 14 (18) the final audit report must be delivered to the pharmacy within 90 15 days after receipt of the preliminary audit report or final appeal; 16 (19) a charge-back, recoupment, or other penalty may not be assessed 17 until the appeal process has been exhausted and the final report issued and may not 18 include charges for dispensing fees; 19 (20) the auditor may not receive compensation based on the percentage 20 of the amount recovered by the auditor; 21 (21) interest may not accrue during the audit period; 22 (22) the auditor shall provide a copy of the final report to a health 23 benefit plan sponsor affected by the audit. 24 (b) This section does not apply to 25 (1) a criminal investigation; or 26 (2) an investigation or audit by a governmental agency, including state 27 Medicaid programs. 28 (c) In this section, "health benefit plan" has the meaning given in 29 AS 21.54.500. 30 * Sec. 3. The uncodified law of the State of Alaska is amended by adding a new section to 31 read:
01 APPLICABILITY. This Act applies to pharmacy audits conducted after the effective 02 date of this Act. 03 * Sec. 4. This Act takes effect immediately under AS 01.10.070(c).