Pharmacy Blog
Following the pharmacy’s submission of a claim, the claim will be received by a service that uses the IDs to route it to the appropriate insurance company or PBM. These are referred to as “switches,” and organizations that provide switching services include Emdeon and RelayHealth. Although they may also charge a set monthly rate, switches typically charge a fee for each transaction. It should be noted that this cost is not covered by insurance; therefore, the switch fee will be incurred once more in the event that the claim is denied by the insurance provider and has to be reprocessed. To increase a pharmacy’s reimbursement and lower its risk of liability, Switches (and other businesses) also provide a range of services that are combined into a single package.
Pre and post edits (PPE) are what these are collectively called, and some instances are as follows:
Resubmission of the AWP:
Average Wholesale Prices (AWP) are subject to regular fluctuations. Regretfully, when medicine prices rise and a pharmacy doesn’t update its computerized drug record files on a weekly or monthly basis, it will submit an AWP to the insurance company that is less than the medication’s current AWP. This frequently leads to claims being underpaid; to fix this, the switch will automatically look for variations in AWP and resubmit with the higher AWP to optimize compensation.
Validation of DAW Codes: Dispense as Written (DAW) codes are typically used to provide the insurance company with justifications for why a
Branded medicine was given out; the default value, DAW 0, indicates that no product selection was made. Additional instances include the following: a) the doctor wrote the brand name alone; b) the patient requested the brand name; c) the generic was not sold; or d) the brand medication was required by law. To prevent auditing problems, the switch has the ability to reject a claim before it is sent to the insurance company if a DAW code is chosen that is contradictory with the product chosen (e.g., a brand picked but DAW 0 utilized).
Validation of quantity and days’ supply: Verifies that the product and quantity entered match the days’ supply. One typical instance is entering the incorrect amount for inhalers (in the pharmacy software system, entering it as “1,” whereas the actual amount the number of grams is the accurate quantity.
DEA Verification: To make sure a prescriber’s DEA number is current and valid, the switch will automatically check it.
NPI verification: The switch will verify the prescriber’s National Provider Identifier (NPI), just like it does with the DEA number. If the NPI is invalid, it has the ability to return the claim. Using the NPI or contacting the prescriber’s office are two ways to get the right NPI.
NDC verification: This service will reject claims that contain out-of-date or discontinued National Drug Codes (NDCs) in order to allow the claim to be resubmitted with a current NDC.
A Medicare Part D Transaction Facilitator, also known as a facilitator, can receive an E1 transaction from a pharmacy if a patient is eligible for Medicare Part D but is either unclear of their coverage or does not have their coverage information with them. If a match is found, the facilitator will retrieve eligibility information from the Medicare database and provide it back to the pharmacy.
Transferring the money paid toward a patient’s True Out of Pocket Costs (TrOOP) to a different insurance provider in the event that the patient changes plans is another pertinent function the facilitator offers they don’t have to start over with the new business.
The claim finally reaches the payer when it is filed by the pharmacy, sent to the switch, and maybe sent via the Medicare Part D Facilitator. After determining the claim’s coverage, the payer will forward it back to the switch, which will then forward it back to the pharmacy. In addition to the switch’s fee, payers typically levy a processing fee for each claim that is submitted.