Tricare West Audit

Experienced Pharmacy Audit Defense Lawyers Provide Comprehensive Advice and Representation Throughout the Pharmacy Benefit Manager Audit Process

**Attorney Lynette Byrd**
Tricare West Audit Team Lead
Contact Lynette

envelope icon — **Attorney Lynette Byrd**
Tricare West Audit Team Lead
Contact Lynette

**Deborah Zarifian**
Tricare West Audit Team Consultant
Former FBI Special Agent
Registered Pharmacist (CT)

Pharmacy benefit managers (PBMs) manage prescription drug plans on behalf of public and private health insurers. While the purpose of a PBM is to ensure access to necessary medication and control patient costs, PBMs have come under scrutiny as drug prices continue to rise. In response, Tricare West and other PBMs are taking additional steps to appear as though they are effective. This has resulted in an increase in the number of Tricare West PBM audits.

If Tricare West is your pharmacy benefits manager and you are facing a PBM audit, you need the assistance of an experienced Tricare West audit attorney to ensure that the outcome of the audit is fair. While a Tricare West PBM audit can lead to significant consequences such as recoupments and contract termination, that doesn’t have to be the case. By providing Tricare West with the necessary documentation, compliant pharmacies quickly wrap up an audit and move on with their business. However, even if mistakes have been made, you may still be able to resolve the audit without incurring significant liability.

At Oberheiden. P.C., our dedicated team of Tricare West audit lawyers works closely with pharmacies, helping through every stage of the audit process. We review the auditors’ procedures to make sure that they do not make any mistakes that could delay the resolution of the audit. We can also affirmatively address any potential violations, putting them in context and minimizing their impact on the outcome of the audit.

Where Does Tricare West Operate?

Tricare West is one of two Tricare PBMs, the other being Tricare East. Tricare West covers the following states and regions:

Alaska,
Arizona,
California,
Colorado,
Hawaii,
Idaho,
Iowa,
Kansas,
Minnesota,
Missouri (except St. Louis),
Montana,
Nebraska,
Nevada,
New Mexico,
North Dakota,
Oregon,
South Dakota,
Texas (Amarillo, Lubbock and El Paso areas),
Utah,
Washington, and
Wyoming

At Oberheiden, P.C., our nationwide team of pharmacy audit attorneys is available to assist pharmacies across the country. We have extensive experience successfully resolving audits and know what it takes to efficiently resolve an audit so you can get back to business without unnecessary delay.

What Can Cause a Tricare West Audit?

As an intermediary between pharmacies and payors, PBMs are tasked with reviewing a pharmacy’s processes to ensure that they are in compliance with the terms of their contract with the payor. Thus, one of the primary focuses during a Tricare West audit is whether the pharmacy improperly billed the payor. If a Tricare West auditor identifies any area of potential non-compliance, it is incumbent on the pharmacy to provide documentation proving compliance. If documentation is not available, auditors will draw a negative inference, which may lead to significant sanctions.

At Oberheiden P.C., our PBM audit attorneys have significant experience defending pharmacies in Tricare West audits and other PBM audits. We routinely deal directly with Tricare West’s auditors on behalf of our pharmacy clients, working closely with our clients before, during, and after the audit to ensure their interests are protected. We have experience defending pharmacies against all types of allegations in Tricare West and other PBM audits, including:

Accepting Prescriptions Written by Excluded Providers

Pharmacies cannot fill prescriptions written by doctors who are on the list of excluded providers. Pharmacies that fill prescriptions from excluded providers, whether intentionally or unintentionally, may be in violation of their PBM contract.

Billing for Unapproved Drugs

The Drug Supply Chain Security Act (DSCSA) requires pharmacies to verify the legitimacy and source of all prescription drugs they purchase. Billing for medications purchased from illegitimate sources can lead to significant penalties in a Tricare West audit. Doing so may also catch the attention of the U.S. Drug Enforcement Administration (DEA), Department of Health and Human Services Office of Inspector General, and other federal agencies. The same is true of providing drugs that have not been approved by the Food and Drug Administration (FDA) or for which FDA approval has been withdrawn.

Compound Drug Issues

Due to the nature of their business, compounding pharmacies often find themselves at the center of a PBM audit. Tricare West auditors keep an eye out for all types of compound pharmacy fraud, including billing for unauthorized drugs and accepting kickbacks from providers.

Failure to Create or Maintain Records

Under federal law and the terms of the PBM contract, pharmacies must create and retain detailed and accurate records of the drugs they purchase and dispense. A pharmacy’s failure to have these records readily available for auditors’ inspection can raise red flags and may result in a finding of liability.

Falsification of Records

The vast majority of pharmacies understand the risks involved with falsifying records to appear compliant. However, occasionally, Tricare West raises allegations that a pharmacy falsified patient or prescription records.

Filling Illegitimate Prescriptions

One of the most common violations discovered during a PBM audit involves the dispensing of illegitimate prescriptions. However, determining the legitimacy of a prescription is not always straightforward and often involves some gray areas. Pharmacies should be prepared to present all documentation that indicates they performed their due diligence to remain in compliance.

Intentional and Unintentional Billing and Coding Errors

Billing and coding prescription drug transactions is an excruciatingly complex process, and mistakes are common. While the majority of these mistakes are inadvertent, even these will not be overlooked by Tricare West auditors. Submitting the wrong billing code, double billing, upcoding, and other issues can result in retractions and other penalties. And, once a pharmacy is found in violation, it increases the likelihood of future Tricare West audits.

Invoice Shortages

Tricare West auditors will review a pharmacy’s records to ensure that the amount of medication dispensed equals the amount of drugs purchased. If these figures do not line up, it is referred to as an invoice shortage. While there are valid reasons why an invoice shortage may occur, Tricare West auditors are unlikely to give a pharmacy the benefit of the doubt absent sufficient documentation. Instead, auditors may claim that the pharmacy sold prescription medication obtained from an illegal source, sold samples, or placed returned medication back into its stock.

Licensing Violations

Pharmacies must remain current with all their licenses. A failure to do so can not only result in problems during a Tricare West audit but may also result in other, potentially more severe, disciplinary action.

PBM Contract Fraud

Pharmacies are in the business of dispensing medication, and operators may not be focused on the specific terms of the PBM contract. However, even a seemingly minor violation of a term contained in a PBM contract can raise serious allegations of misconduct.

Telemedicine Violations

Telemedicine and mail-order pharmacies are seen as presenting a high risk of prescription drug fraud. As a result, Tricare West auditors tend to scrutinize every aspect of these pharmacies’ processes.

At Oberheiden. P.C., our Tricare West PBM audit attorneys have notable experience helping pharmacies deal with the myriad issues that come up during the audit process. While the above are some of the more common concerns raised by Tricare West during its audits, we are prepared to address whatever issues come up during your audit. Several of our senior attorneys spent years working in the DEA and Office of Inspector General before joining Oberheiden, P.C. This provides us with unique insight into how PBM auditors conduct these audits and how to resolve them efficiently while avoiding any finding of liability.

Dr. Nick Oberheiden

Founder

Attorney-at-Law

Lynette S. Byrd

Former DOJ Trial Attorney

Partner

Brian J. Kuester

Former U.S. Attorney

Hon. Kevin McCarthy

55th Speaker, U.S. House of Representatives (ret.)

Government Consultant

Mike Pompeo

Of Counsel

Former U.S. Secretary of State

John W. Sellers

Former Senior DOJ Trial Attorney

Linda Julin McNamara

Federal Appeals Attorney

Nicholas B. Johnson

Former Prosecutor

Roger Bach

Former Special Agent (DOJ)

Chris J. Quick

Former Special Agent (FBI & IRS-CI)

Michael S. Koslow

Former Supervisory Special Agent (DOD-OIG)

Ray Yuen

Former Supervisory Special Agent (FBI)

Frequently Asked Questions:

What is a pharmacy benefit manager?

A pharmacy benefit manager (PBM) is a company that manages prescription drug benefits on behalf of an insurance company. As it relates to pharmacies, the role of the PBM is to ensure that pharmacies do not improperly bill the insurance company and that pharmacies are in compliance with all federal laws and regulations. While the PBM auditors are looking out for the interests of the insurance company, they will often provide law enforcement with any information indicating that a pharmacy may be operating in violation of the law. Thus, while a PBM audit is somewhat limited in scope, the repercussions of an unfavorable audit can be tremendous. Thus, any pharmacy that is subject to a Tricare West audit should immediately enlist the assistance of an experienced PBM audit attorney.

What are a pharmacies’ rights related to a Tricare West audit?

Tricare West is a pharmacy benefit manager and is not acting on behalf of the government. Thus, a pharmacy’s rights related to a PBM audit are contractually defined, as outlined in the PBM contract. Thus, to a large degree, the rights a pharmacy has related to a PBM audit depend on the specific terms of the PBM contact as well as the laws of the state where the pharmacy is located. However, generally speaking, pharmacies have the following rights when being subject to a PBM audit:

Reasonable notice of the audit;
A limited and clearly defined look-back period;
Reimbursement for claims that were improperly denied;
Timely notice of the results of the audit; and
Clear and documented explanations of any demand for recoupment.

It is likely that pharmacies also have additional rights under the terms of their contract with Tricare West. An experienced Tricare West pharmacy audit attorney can identify all of a pharmacy’s rights and ensure that they remain protected throughout the audit process.

What is at stake in a Tricare West audit?

Tricare West audits are conducted to ensure that pharmacies are not improperly billing the insurance company. Thus, if substantial violations are uncovered, the PBM may demand a recoupment or could even terminate the contract with the pharmacy. However, if, during the course of the audit, auditors discover anything that could result in civil or criminal liability, they may refer the case to state or federal law enforcement agencies. This opens the door to much more severe consequences. As a result, any pharmacy subject to a Tricare West audit should not delay in protecting their interests by reaching out to a knowledgeable PBM audit attorney.

Speak with a Tricare West Audit Defense Attorney at Oberheiden P.C.

If you would like more information about Oberheiden, P.C and our pharmacy audit defense practice, please contact us to arrange a confidential consultation with one of our senior attorneys or compliance consultants. You can reach the firm by calling 888-680-1745 to schedule an appointment. You can also complete our online contact form, and one of our lawyers will reach out to you shortly.