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The Pharmacy Technician
FOUNDATIONS AND PRACTICES
Chapter 9
Inventory Management and
Health Insurance Billing
The Pharmacy Technician: Foundations and Practices
Mike Johnston, Karen Davis, and Jeff Gricar
Copyright ©2009 by Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
All rights reserved.
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
The Pharmacy Technician: Foundations and Practices
Mike Johnston, Karen Davis, and Jeff Gricar
Copyright ©2009 by Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
All rights reserved.
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
The Pharmacy Technician: Foundations and Practices
Mike Johnston, Karen Davis, and Jeff Gricar
Copyright ©2009 by Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
All rights reserved.
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
The Pharmacy Technician: Foundations and Practices
Mike Johnston, Karen Davis, and Jeff Gricar
Copyright ©2009 by Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
All rights reserved.
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
The Pharmacy Technician: Foundations and Practices
Mike Johnston, Karen Davis, and Jeff Gricar
Copyright ©2009 by Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
All rights reserved.
Figure 9.1
The first step in the ordering process is generating an order.
The Pharmacy Technician: Foundations and Practices
Mike Johnston, Karen Davis, and Jeff Gricar
Copyright ©2009 by Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
All rights reserved.
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)
The Pharmacy Technician: Foundations and Practices
Mike Johnston, Karen Davis, and Jeff Gricar
Copyright ©2009 by Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
All rights reserved.
Figure 9.2
Verifying an order.
The Pharmacy Technician: Foundations and Practices
Mike Johnston, Karen Davis, and Jeff Gricar
Copyright ©2009 by Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
All rights reserved.
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)
The Pharmacy Technician: Foundations and Practices
Mike Johnston, Karen Davis, and Jeff Gricar
Copyright ©2009 by Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
All rights reserved.
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)
The Pharmacy Technician: Foundations and Practices
Mike Johnston, Karen Davis, and Jeff Gricar
Copyright ©2009 by Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
All rights reserved.
Figure 9.6
Handling returns is part of inventory management.
The Pharmacy Technician: Foundations and Practices
Mike Johnston, Karen Davis, and Jeff Gricar
Copyright ©2009 by Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
All rights reserved.
Returns
• Typically related to one of following
reasons:
–
–
–
–
–
Expired drugs
Manufacturer recalls
Overstocked/undesired products
Incorrect product sent by supplier
Item incorrectly ordered
The Pharmacy Technician: Foundations and Practices
Mike Johnston, Karen Davis, and Jeff Gricar
Copyright ©2009 by Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
All rights reserved.
Returns (cont.)
• Product returned must be in its original
•
condition
Each supplier has specific procedure for
handling returns
The Pharmacy Technician: Foundations and Practices
Mike Johnston, Karen Davis, and Jeff Gricar
Copyright ©2009 by Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
All rights reserved.
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
The Pharmacy Technician: Foundations and Practices
Mike Johnston, Karen Davis, and Jeff Gricar
Copyright ©2009 by Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
All rights reserved.
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
The Pharmacy Technician: Foundations and Practices
Mike Johnston, Karen Davis, and Jeff Gricar
Copyright ©2009 by Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
All rights reserved.
Figure 9.7
The insurance billing process is usually done by computer.
The Pharmacy Technician: Foundations and Practices
Mike Johnston, Karen Davis, and Jeff Gricar
Copyright ©2009 by Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
All rights reserved.
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
The Pharmacy Technician: Foundations and Practices
Mike Johnston, Karen Davis, and Jeff Gricar
Copyright ©2009 by Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
All rights reserved.
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
The Pharmacy Technician: Foundations and Practices
Mike Johnston, Karen Davis, and Jeff Gricar
Copyright ©2009 by Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
All rights reserved.
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 brandname drug)
Days supply—number of days a
dispensed quantity of medication will last
The Pharmacy Technician: Foundations and Practices
Mike Johnston, Karen Davis, and Jeff Gricar
Copyright ©2009 by Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
All rights reserved.
Figure 9.8
Insurance information.
The Pharmacy Technician: Foundations and Practices
Mike Johnston, Karen Davis, and Jeff Gricar
Copyright ©2009 by Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
All rights reserved.
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
The Pharmacy Technician: Foundations and Practices
Mike Johnston, Karen Davis, and Jeff Gricar
Copyright ©2009 by Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
All rights reserved.
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
The Pharmacy Technician: Foundations and Practices
Mike Johnston, Karen Davis, and Jeff Gricar
Copyright ©2009 by Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
All rights reserved.
Figure 9.9
There are times when an insurance issue cannot be handled by computer.
The Pharmacy Technician: Foundations and Practices
Mike Johnston, Karen Davis, and Jeff Gricar
Copyright ©2009 by Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
All rights reserved.
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
The Pharmacy Technician: Foundations and Practices
Mike Johnston, Karen Davis, and Jeff Gricar
Copyright ©2009 by Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
All rights reserved.
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
The Pharmacy Technician: Foundations and Practices
Mike Johnston, Karen Davis, and Jeff Gricar
Copyright ©2009 by Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
All rights reserved.