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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.