PTCB Billing & Reimbursement cheat sheet

Payer categories include commercial/private insurers, Medicare Part D, Medicaid, TRICARE, workers' compensation, and self-pay patients; each sets its own formulary, cost-sharing, and reimbursement rules.

The BIN on a benefit card routes the electronic claim to the correct claims processor; the PCN identifies the specific plan or benefit package within that processor.

Member identity data needed on a claim: cardholder ID, group number, person code (to separate family members on one card), and patient relationship code.

AWP is a published list-price benchmark; WAC is the manufacturer's price to wholesalers; MAC is the payer's maximum allowable ingredient cost for a specific generic product.

Standard reimbursement formula: allowed amount = ingredient cost (AWP minus a contracted percentage, WAC, or MAC) + a contracted dispensing fee.

Lesser-of rule: the payer reimburses the lowest of the contracted allowed amount, the pharmacy's billed charge, or the pharmacy's usual and customary cash price.

Usual and customary (U&C) price is the pharmacy's cash price to the general public; it must be reported on claims and made available to uninsured patients.

Medicare Part D covers most outpatient prescription drugs through stand-alone prescription drug plans or Medicare Advantage prescription drug plans; Medicare Part B covers drugs furnished incident to a physician's service.

A pharmacy benefit manager builds formularies and pharmacy networks, adjudicates claims, negotiates manufacturer rebates, and applies post-adjudication DIR fees on behalf of the plan sponsor.

Claims are transmitted in the NCPDP Telecommunication Standard format, which uses defined segments including header, patient, insurance, claim, pharmacy, prescriber, coordination of benefits, and pricing.

NDCs are submitted in 11-digit, 5-4-2 format with leading zeros added so the labeler, product, and package segments are each fixed length.

Core claim data: BIN, PCN, cardholder ID, group, NDC, quantity dispensed, days supply, fill number, date written, DAW code, and prescriber identifier.

Point-of-sale adjudication is real time; the payer returns a paid, rejected, or denied response while the patient is still at the counter.

Rejection means the claim was not adjudicated because of an error and can be corrected and resubmitted; denial means the claim was adjudicated but is not payable for coverage or medical necessity reasons.

A paid claim must be reversed before it is rebilled, and the reversal must match the original transaction, fill number, and date to prevent duplicate payment.

Refill-too-soon edits compare elapsed days since the last fill against the billed days supply; most plans allow a refill once roughly 75-80% of the supply has been consumed.

An eligibility or benefit inquiry (B1/B2 or 248 transaction) verifies active coverage and returns copay and benefit information without dispensing a product.

DAW codes document substitution: 0 means no product selection indicated, 1 means the prescriber requested brand, and 2 means the patient requested brand; the code can change pricing.

Allowed amount = ingredient cost + dispensing fee. Patient pay amount = copay + deductible + coinsurance + non-covered charges. Payer payment = allowed amount minus patient pay amount.

In coordination of benefits, the primary plan adjudicates first and transmits its payment data in the COB segment; the secondary plan pays up to the remaining balance and never more than the total charge.

Medicare Part D benefit phases occur in this order: deductible, initial coverage, coverage gap, catastrophic.

TrOOP (true out-of-pocket) costs count toward the catastrophic threshold; they include patient payments and certain manufacturer discounts but exclude amounts paid by other insurance.

Typical commercial tier structure: tier 1 generic, tier 2 preferred brand, tier 3 non-preferred brand, tier 4 or specialty with the highest patient cost share.

Coinsurance is a percentage of the allowed amount (for example 20%); a copay is a fixed dollar amount; both are forms of patient cost sharing applied after the deductible.

Medicaid programs may charge only nominal copays, exempt certain populations such as pregnant patients and children, and prohibit balance billing beyond the copay.

DIR fees are post-point-of-sale reconciliations applied by Part D plans after adjudication, so effective reimbursement can be lower than the amount paid at the counter.

Copay accumulator programs exclude manufacturer copay assistance from counting toward the patient's deductible or out-of-pocket maximum.

Common NCPDP rejects: 70 NDC not covered, 75 prior authorization required, 76 plan limitations exceeded, 79 refill too soon, 88 DUR reject, 25 missing or invalid member ID, 8 missing or invalid BIN.

Correctable data rejects (member ID, BIN, quantity, days supply) are fixed and resubmitted; coverage rejects require prior authorization, step therapy approval, or a quantity limit override.

Prior authorization requires the prescriber to submit clinical documentation, and approval is granted for a defined period and quantity.

DUR rejects for therapeutic duplication, drug interaction, high dose, or drug-disease contraindication are resolved by prescriber consultation with override codes or by changing therapy.

Medicare Part D appeal levels in order: redetermination, reconsideration by an Independent Review Entity, ALJ hearing, Medicare Appeals Council, federal district court.

Part D decision timelines: coverage determination 72 hours standard or 24 hours expedited; redetermination 7 calendar days standard or 72 hours expedited.

The federal Anti-Kickback Statute prohibits offering or receiving remuneration to induce referrals or purchases covered by federal healthcare programs; routinely waiving copays can violate it.

The False Claims Act imposes civil liability, including treble damages, for knowingly submitting false claims, and qui tam relators may sue on the government's behalf.

PBM audits reconcile billed claims against prescription records, so pharmacies must retain original prescriptions, refill documentation, and DUR records for the period required by state law.