Your team has worked diligently to prepare a barrage of medication orders, provided crucial clinical support to your long-term care (LTC) facilities, and built strong relationships with your patients. Yet, month after month, a significant chunk of your hard-earned revenue vanishes into the black hole of claim rejections. Sound familiar?
We recently witnessed a powerful example of how a focused approach can dramatically change this narrative. One of our valued customers, after going through a workflow and billing consultation, experienced a 4x reduction in monthly claim rejections, plummeting from a staggering $80,000 down to just $20,000. This translates to six-figure annual savings – real money directly impacting their bottom line.
Their success story highlights a crucial truth: a reimbursement-friendly workflow isn't just a nice-to-have; it's a fundamental pillar of a thriving LTC pharmacy. And often, the key to unlocking this efficiency lies in an area that might be overlooked: order entry.
The order entry process is the foundation for the entire dispensing and billing cycle. Every piece of information – patient demographics, prescriber details, medication specifics, insurance information – is captured (or missed) at this stage. In the fast-paced environment of an LTC pharmacy, it's easy for seemingly minor errors or omissions during order entry to snowball into major billing headaches down the line.
Incorrect Patient Demographics: A misspelled name, a wrong date of birth, or an inaccurate member ID can lead to immediate claim rejections.
Missing or Incomplete Prescriber Information: National Provider Identifiers (NPIs), DEA numbers, and even a missing state license can halt reimbursement.
Inaccurate Medication Details: Dosage errors, incorrect NDCs, or missing route of administration can trigger rejections or audits.
Flawed Insurance Information: Outdated insurance cards, incorrect plan codes, or missing prior authorization details are prime culprits for denials.
Lack of Proper Documentation: Notes regarding prior authorizations, medical necessity, or dispensing exceptions, if not captured accurately at the outset, can make appealing rejections an uphill battle
Order entry, often perceived as a more administrative task, can inadvertently drain your billing department's resources and your pharmacy's profitability. It's time to elevate its importance and implement strategies to ensure accuracy and completeness from the first keystroke.
So, how do you transform your order entry process from a potential liability into a reimbursement asset? Here are some key solutions and system considerations:
Recommendation: Implement a robust system for regularly updating and integrating insurance plan formularies into your pharmacy software.
Option/System Review: Explore software features that provide real-time formulary checks during order entry. This can alert technicians to non-preferred medications before dispensing, allowing for proactive communication with prescribers and facilities regarding potential alternatives.
Benefit: Reduces dispensing of non-covered medications, minimizing rejections and the need for costly rework.
Recommendation: Institute mandatory double-checks for critical data points during order entry. This could involve a second technician verifying key information like patient ID, medication name, strength, and insurance details.
Option/System Review: Use software features that allow for customizable verification prompts and flags for high-risk fields such as dollar amounts and special order medications.
Benefit: Catches errors early in the process, preventing them from propagating through the workflow and impacting billing.
Recommendation: Develop clear, concise Standard Operating Procedures (SOPs) for order entry, emphasizing the importance of accuracy and completeness for billing. Invest in comprehensive and ongoing training for your order entry technicians.
Option/System Review: Create standardized data entry fields and drop-down menus within your pharmacy system to ensure consistency. Implement regular audits of order entry accuracy to identify areas for improvement and provide targeted training.
Benefit: Ensures all staff follow best practices, reduces variability, and fosters a culture of accountability in the order entry department.
Recommendation: Integrate real-time eligibility verification tools into your workflow. This allows your team to confirm patient insurance coverage and identify potential issues before dispensing.
Option/System Review: Explore software integrations with payer systems that provide instant eligibility checks. Set up alerts for expired coverage or the need for prior authorizations.
Benefit: Prevents dispensing to patients with inactive coverage or without necessary authorizations, significantly reducing denial rates.
Recommendation: Train order entry staff to capture all relevant clinical and administrative information at the time of order receipt. This includes documenting prior authorization numbers, medical necessity justifications, and any communication with prescribers or facilities.
Option/System Review: Record pertinent details using note fields and electronic documentation features within your pharmacy system. Create templates for common documentation requirements.
Benefit: Provides support for clean claim submissions and simplifies the appeals process if rejections occur.
The Immense Potential of AI for Better Reimbursement: Looking ahead, the integration of Artificial Intelligence (AI) holds immense potential to revolutionize the order entry process and drastically reduce denial rates. At some point in the not-so-distant future, AI-powered systems will be capable of automatically verifying data against multiple sources, identifying and correcting potential errors before they impact billing, and in a future state, not just alerting you of errors or potential concerns, but proactively resolving blank or missing data fields in real-time. While these advancements are still evolving, the future of LTC pharmacy order entry points towards AI as a powerful tool in minimizing human error and achieving near-zero denial rates.
The opportunity for six-figure savings from reducing claim denials is a powerful reminder that even seemingly small adjustments in your workflow, particularly at the order entry stage, can yield significant financial results. By prioritizing accuracy, leveraging technology, and empowering your team with the right tools and training, you can build a reimbursement-friendly LTC pharmacy that minimizes denials and maximizes revenue.
Is your pharmacy leaving money on the table due to preventable claim rejections? Our professional services and consulting are designed to help you identify inefficiencies in your workflow and implement tailored solutions that drive tangible results, just like the $60,000 monthly savings our client achieved. In a highly regulated industry where your COGS (inventory) and Revenue (Reimbursement Rates) are out of your control, improving your business operations is key to being competitive with other pharmacies and impacting your pharmacy's overall profit margin. Schedule a consulting discovery call to see how your pharmacy could benefit from improved claim reimbursement, better inventory management, and an re-engineered order entry workflow to improve efficiency and create a leaner, more financially stable pharmacy.