Pharmacy work is complex and must follow many bylaws and regulations. Being prepared for an audit at any time is essential.
What is a Pharmacy Compliance Audit?
A pharmacy compliance audit is an inspection of your pharmacy’s business practices to ensure compliance with state and federal regulations. The word “audit” most likely makes every pharmacy owner and pharmacist nervous as scrutiny over how your business is conducted can be unsettling. However, audits are necessary to establish that every pharmacy and its employees are above board and obedient to the law.
Pharmacy compliance audits fall into two categories: third party provider audits and regulatory agency audits.
- Third Party Provider Audits: If your pharmacy is a contract provider of prescription services, it’s subject to a clause in its provider agreement that allows an audit of the pharmacy’s records, including hard-copy prescriptions, signature logs, computerized refill records, and invoice records.
- Regulatory Agency Audits: All pharmacies are subject to state and federal licensing agency audits (i.e. DEA and State Board of Pharmacy).
Before an audit occurs, you will be provided notice. Take the time between receiving this notice and when the audit begins to make sure everything is in order. Keeping a “Pharmacy Audit Checklist” is a great way to guarantee you’re prepared for an audit at any time.
Types of Audits
The type of audit your pharmacy receives depends on the entity conducting the audit and the specific area the audit is focusing on. Some common types of audits include:
Regulatory Audits: These audits specifically assess prescription records, controlled substances handling, and staff licensing. These types of audits are carried out by state and federal agencies like the State Board of Pharmacy, the Drug Enforcement Agency (DEA), the FDA (Food and Drug Administration), and the Centers for Medicare and Medicaid Services (CMS).
Financial Audits: These types of audits are done to review billing and claims submissions. They also uncover fraud, waste, and abuse. Insurance providers and Pharmacy Benefit Managers (PBMs) conduct these types of audits.
Operational Audits: This type of audit can be conducted by a regulatory agency like the DEA, a third party provider, or a PBM. Day-to-day operations of a pharmacy are examined including inventory management, workflow processes, and employee compliance with state and federal policies.
Quality Assurance Audits: These types of audits could be conducted by an internal auditor, a PBM, or a regulatory agency. Patient safety measures, medication errors, and adherence to patient care practices are examined in this type of audit.
No matter what type of audit is taking place, the general reason for an audit is to make sure safe business practices are in place, and state and federal regulations are being upheld. There are some things you can do to make sure you’re prepared for an audit at any time.
How to Prepare for a Pharmacy Compliance Audit
Being prepared for an audit at any time gives you peace of mind when one is issued for your pharmacy. Avoiding compliance issues with an audit takes preparation; here are some things to consider:
- Implement Strong Policies and Procedures: Ensuring that all of your employees know and follow the guidelines put in place in your pharmacy is the first step in avoiding problems. How medication is handled, how billing is completed, and how records are kept are all important aspects of training that every employee should undergo.
- Conduct Internal Audits: Holding your pharmacy’s staff accountable means reviewing your business practices regularly. Checking that prescription records, billing claims, and controlled substance logs are accurate every few weeks sets up a checks and balances record of your pharmacy.
- Train Staff & Keep Up to Date with Regulations: Open the lines of communication with your staff and keep them informed of any changes made by regulatory agencies. Train your staff continuously so they are aware of changes and understand what needs to be done to stay compliant.
Following these tips should set your pharmacy up for success with any compliance audit that comes its way. Avoiding non-compliance is the goal, as the consequences can be severe.
Consequences of Non-Compliance in a Pharmacy Compliance Audit
Your pharmacy and its future depends on the compliance audits that are conducted. If your pharmacy is found to be in noncompliance with regulations, you could face hefty fines, firing of employees, loss of your business’s reputation or even loss of your pharmacy.
If you’ve received notice that your pharmacy is noncompliant with state or federal regulations as a result of a compliance audit, consulting an experienced legal professional is advised. The team at The Law Offices of Robert J. DeGroot can help. They have the experience and skill to assist you in avoiding negative consequences.
If your pharmacy has been found noncompliant as a result of a pharmacy compliance audit, reach out to the Law Offices of Robert J. DeGroot today!
