1. Copyright ©2009 by Pearson Education, Inc. Upper Saddle River, New Jersey 07458 All rights reserved. The Pharmacy Technician: Foundations and Practices Mike Johnston, Karen Davis, and Jeff Gricar The Pharmacy Technician FOUNDATIONS AND PRACTICES Chapter 9 Inventory Management and Health Insurance Billing

2. Copyright ©2009 by Pearson Education, Inc. Upper Saddle River, New Jersey 07458 All rights reserved. The Pharmacy Technician: Foundations and Practices Mike Johnston, Karen Davis, and Jeff Gricar Purchasing Systems Independent purchasing—pharmacy director is responsible for written contracts with each pharmaceutical manufacturer Group purchasing—pharmacy joins an organization that contracts with pharmaceutical manufacturers collectively for all members

3. Copyright ©2009 by Pearson Education, Inc. Upper Saddle River, New Jersey 07458 All rights reserved. The Pharmacy Technician: Foundations and Practices Mike Johnston, Karen Davis, and Jeff Gricar Methods of Purchasing Direct—pharmacy buyer places separate orders with each pharmaceutical company and receives separate shipments Wholesale—pharmacy purchases a large number of products from various manufacturers from a single source

4. Copyright ©2009 by Pearson Education, Inc. Upper Saddle River, New Jersey 07458 All rights reserved. The Pharmacy Technician: Foundations and Practices Mike Johnston, Karen Davis, and Jeff Gricar Methods of Purchasing (cont.) Primary vendor—pharmacy contracts with a single vendor –Comes with all of the benefits of using a wholesaler –Often better pricing and service terms –May have dollar-volume commitment and purchasing restrictions

5. Copyright ©2009 by Pearson Education, Inc. Upper Saddle River, New Jersey 07458 All rights reserved. The Pharmacy Technician: Foundations and Practices Mike Johnston, Karen Davis, and Jeff Gricar Formularies A listing of drugs approved for a specific purpose Formularies can be used as: –Reference manuals –Recommendations for prescribing –Strict parameters for medications stocked and approved for reimbursement

6. Copyright ©2009 by Pearson Education, Inc. Upper Saddle River, New Jersey 07458 All rights reserved. The Pharmacy Technician: Foundations and Practices Mike Johnston, Karen Davis, and Jeff Gricar Figure 9.1 The first step in the ordering process is generating an order.

7. Copyright ©2009 by Pearson Education, Inc. Upper Saddle River, New Jersey 07458 All rights reserved. The Pharmacy Technician: Foundations and Practices Mike Johnston, Karen Davis, and Jeff Gricar Process of Ordering Medications Varies slightly based on the purchasing system and supplier(s) The key steps in ordering medications are: –Generate order (may be automated or manual system, or combination of both) –Review order (scan to see if order is correct) –Confirm order (make any corrections necessary) –Submit order (electronically or by telephone)

8. Copyright ©2009 by Pearson Education, Inc. Upper Saddle River, New Jersey 07458 All rights reserved. The Pharmacy Technician: Foundations and Practices Mike Johnston, Karen Davis, and Jeff Gricar Figure 9.2 Verifying an order.

9. Copyright ©2009 by Pearson Education, Inc. Upper Saddle River, New Jersey 07458 All rights reserved. The Pharmacy Technician: Foundations and Practices Mike Johnston, Karen Davis, and Jeff Gricar Receiving an Order Accept delivery of the order (via employed courier in secured plastic totes) Verify the order (the packing list, the invoice, and the actual order are reconciled) Adjust the inventory (computer system automatically updates inventory levels based on shipment delivered)

10. Copyright ©2009 by Pearson Education, Inc. Upper Saddle River, New Jersey 07458 All rights reserved. The Pharmacy Technician: Foundations and Practices Mike Johnston, Karen Davis, and Jeff Gricar Receiving an Order (cont.) Stock the order (medications must be stored according to the specifications of the manufacturer) File the paperwork concerning the order (pharmacy must keep records of each order placed and received)

11. Copyright ©2009 by Pearson Education, Inc. Upper Saddle River, New Jersey 07458 All rights reserved. The Pharmacy Technician: Foundations and Practices Mike Johnston, Karen Davis, and Jeff Gricar Figure 9.6 Handling returns is part of inventory management.

12. Copyright ©2009 by Pearson Education, Inc. Upper Saddle River, New Jersey 07458 All rights reserved. The Pharmacy Technician: Foundations and Practices Mike Johnston, Karen Davis, and Jeff Gricar Returns Typically related to one of following reasons: –Expired drugs –Manufacturer recalls –Overstocked/undesired products –Incorrect product sent by supplier –Item incorrectly ordered

13. Copyright ©2009 by Pearson Education, Inc. Upper Saddle River, New Jersey 07458 All rights reserved. The Pharmacy Technician: Foundations and Practices Mike Johnston, Karen Davis, and Jeff Gricar Returns (cont.) Product returned must be in its original condition Each supplier has specific procedure for handling returns

14. Copyright ©2009 by Pearson Education, Inc. Upper Saddle River, New Jersey 07458 All rights reserved. The Pharmacy Technician: Foundations and Practices Mike Johnston, Karen Davis, and Jeff Gricar Medicaid and Medicare Medicaid—government health insurance program for individuals and families with low incomes or members with disabilities; eligibility requirements are determined and vary by state

15. Copyright ©2009 by Pearson Education, Inc. Upper Saddle River, New Jersey 07458 All rights reserved. The Pharmacy Technician: Foundations and Practices Mike Johnston, Karen Davis, and Jeff Gricar Medicaid and Medicare (cont.) Medicare—government health insurance program for individuals aged 65 or older, younger people with disabilities, and people with ESRD; provides hospital, medical, and prescription insurance

16. Copyright ©2009 by Pearson Education, Inc. Upper Saddle River, New Jersey 07458 All rights reserved. The Pharmacy Technician: Foundations and Practices Mike Johnston, Karen Davis, and Jeff Gricar Figure 9.7 The insurance billing process is usually done by computer.

17. Copyright ©2009 by Pearson Education, Inc. Upper Saddle River, New Jersey 07458 All rights reserved. The Pharmacy Technician: Foundations and Practices Mike Johnston, Karen Davis, and Jeff Gricar Insurance Terms Adjudication—process of transmitting a prescription electronically to the proper insurance company or third-party biller for approval and billing Carrier/Insurer/Provider—the patient’s insurance company Processor—company hired by the insurer to process claims

18. Copyright ©2009 by Pearson Education, Inc. Upper Saddle River, New Jersey 07458 All rights reserved. The Pharmacy Technician: Foundations and Practices Mike Johnston, Karen Davis, and Jeff Gricar Insurance Terms (cont.) Claim—request for reimbursement from a healthcare provider to an insurance provider, for products or services rendered Co-pay—portion of the cost of a service or product that a patient pays out of pocket each time the service or product is provided

19. Copyright ©2009 by Pearson Education, Inc. Upper Saddle River, New Jersey 07458 All rights reserved. The Pharmacy Technician: Foundations and Practices Mike Johnston, Karen Davis, and Jeff Gricar Insurance Terms (cont.) Deductible—a set amount a client pays up front before insurance coverage applies; may be paid at once or in parts DAW (Dispense As Written)—used by prescribers to instruct the pharmacy to use the exact drug written (usually a brand- name drug) Days supply—number of days a dispensed quantity of medication will last

20. Copyright ©2009 by Pearson Education, Inc. Upper Saddle River, New Jersey 07458 All rights reserved. The Pharmacy Technician: Foundations and Practices Mike Johnston, Karen Davis, and Jeff Gricar Figure 9.8 Insurance information.

21. Copyright ©2009 by Pearson Education, Inc. Upper Saddle River, New Jersey 07458 All rights reserved. The Pharmacy Technician: Foundations and Practices Mike Johnston, Karen Davis, and Jeff Gricar Collecting Data for Insurance Purposes Information gathered must exactly match the information that the insurance company has on file –Correct name –Correct address –Marital status –Date of birth

22. Copyright ©2009 by Pearson Education, Inc. Upper Saddle River, New Jersey 07458 All rights reserved. The Pharmacy Technician: Foundations and Practices Mike Johnston, Karen Davis, and Jeff Gricar Transmit a Prescription for Insurance First ensure that the patient profiles match The insurance provider will need to know: –Name of the medication being dispensed (which is matched against a formulary; the insurance provider will only pay for approved medications) –Strength and dose of medication –Whether a generic alternative is available

23. Copyright ©2009 by Pearson Education, Inc. Upper Saddle River, New Jersey 07458 All rights reserved. The Pharmacy Technician: Foundations and Practices Mike Johnston, Karen Davis, and Jeff Gricar Figure 9.9 There are times when an insurance issue cannot be handled by computer.

24. Copyright ©2009 by Pearson Education, Inc. Upper Saddle River, New Jersey 07458 All rights reserved. The Pharmacy Technician: Foundations and Practices Mike Johnston, Karen Davis, and Jeff Gricar Common Insurance Billing Errors Continue gathering information when errors occur Incorrect name—may be due to nicknames, marriage, or divorce Incorrect days supply—will affect refill times and insurance reimbursements

25. Copyright ©2009 by Pearson Education, Inc. Upper Saddle River, New Jersey 07458 All rights reserved. The Pharmacy Technician: Foundations and Practices Mike Johnston, Karen Davis, and Jeff Gricar Common Insurance Billing Errors (cont.) Incorrect provider—because of changes in employment or employer benefits Incorrect birth date—may be entered incorrectly for a number of reasons