Documents needed for a BCBSM pharmacy audit

In the December 2014 issue of BCBSM’s The Record, BCBSM reminds pharmacies that the following documents should be available to BCBSM if contacted for an audit in order to avoid preventable findings which could result in significant financial recoupment:

Prescriptions. Original prescriptions for written and verbal orders must be submitted by the pharmacy printed copies of electronic and faxed prescriptions are permissible. Scans of written and verbal prescriptions will not be accepted. If the claim was submitted with a “compound 2” indicator, the pharmacy must also supply the compound record, including the national drug codes and the quantities used.

Dispensing histories. A printout of the dispensing history of each prescription (i.e., the date of each dispense for the life of the prescription as well as the quantity dispensed) must be produced including any changes in the medication, drug strength or quantity for any dispense. The pharmacy’s software should be able to produce such printout. If not, the dispensing history can be written on a photocopy or back of each prescription.

Signature logs. All BCSM and BCN prescription drug programs require a signature from the member, their representative or their caregiver at the time of dispense to verify receipt of their medications. BCBSM/BCN accepts a member’s/representative’s/caregiver’s signature on a manual or electronic log, including signatures from drive-through customers, as proof that the member received the prescription. For prescriptions that pharmacies mail to members, the pharmacy should provide a dated “proof of delivery/receipt” signed by the member/representative/caregiver.

Members’ rights notice. BCBSM is required to report to the Centers for Medicare & Medicaid Services whether network pharmacies are compliant with the requirement to give Medicare Part D patients a copy of the Medicare Prescription Drug Coverage and Your Rights Standardized Pharmacy Notice (CMS-10147/OMB 0938-0975) if the prescription cannot be filled. Please have this notice printed to show the auditor.

Record retention. For BCBSM and BCN commercial, a pharmacy must keep prescription records for a minimum of five (5) years from the last date of service. Michigan law requires that every prescription has to be preserved for at least five (5) years. The federally administered Medicare plan requires that prescriptions be retained a minimum of 10 years after the last date of service.

If your pharmacy is contacted by BCBSM for an audit, you should contact an experienced attorney to assist you in order to reduce the likelihood of significant overpayment demands. The earlier the involvement of experienced legal counsel, the better the opportunity for a successful outcome.

Robert S. Iwrey Esq., a founding partner of The Health Law Partners, P.C., practices in all areas of healthcare law and devotes a substantial portion of his practice assisting clients in pharmacy legal matters including compliance, third party payor audits, government investigations, state licensing and DEA registrations. For more information regarding this article, please contact Robert S. Iwrey, Esq. at (248) 996-8510 or (212) 734-0128 or

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