Pharmacy Accreditation

There are many questions about the recently passed health care reform act and how it affects pharmacies and accreditation. We do not know how CMS will implement the components of this law, but we do know what changes the new law provides.

The Affordable Care Act provides an exemption from the accreditation requirement for pharmacies that can meet certain criteria:

• The volume of DMEPOS billings are 5 percent or less of total pharmacy sales;
• There have been no adverse fraud or abuse determinations against the pharmacy for the last five years; and
• Submission to randomly selected on-site Medicare audits to confirm attestation.

Additionally, the exempted pharmacy will be required to:

• Submit an attestation (possibly certified financial statements, notarized documents, etc.) that its total Medicare DMEPOS billings are, and continue to be, less than a rolling three year average of 5 percent of total pharmacy sales; and
• Submit documentation on an ongoing, rolling basis that would verify this information.

The legislation also states that the Health and Human Services Secretary may apply alternative accreditation requirements deemed appropriate for those seeking the exemption.

One very important item to know is that there is no exemption for a new pharmacy. Providers who wish to open a new pharmacy must be accredited, whether or not they currently have an exempted site.

The law also postpones the current deadline for pharmacy accreditation to be effective until January 2011. This affects pharmacies that are not yet accredited and do not meet the exemption criteria listed.

Owners and managers of pharmacies that are currently accredited need to be aware of and think about these items if they are considering not renewing their accreditation:

• Pharmacies that wish to participate in competitive bidding at any time are not exempt from accreditation.
• Medicare is not the only payer that requires accreditation. There are many state Medicaid programs as well as many HMOs, PPOs and third-party payers that currently require accreditation. Accreditation applies to all of a pharmacy’s customers, not just Medicare beneficiaries.
• There are processes and procedures in place. An accredited provider does not need to reinvent the wheel in order to maintain accreditation.
• If a currently accredited pharmacy chooses to open a new location, the accreditation applies to a new location automatically.

When a pharmacy is approaching renewal, management should be cognizant of the following:

• CMS is vigorously enforcing accreditation dates and deadlines. Ideally, all providers need to budget for a minimum of six months’ lead time to be prepared for the unannounced, onsite survey. You must be re-accredited before your actual accreditation expiration date so that your accreditation does not lapse.
• The National Supplier Clearinghouse (NSC) will deactivate a non-exempt supplier’s billing privileges if its accreditation lapses. If the NSC revokes privileges, there is a one-year mandatory waiting period for re-application to reinstate privileges.

We will have to wait and see over the next few months what additional specifications CMS will require for pharmacies choosing not to become accredited. If this affects you and you have questions, contact your accreditor for clarifications.

Are you watching your accreditation timeline?

Accreditation from most organizations generally lasts for three years, and CMS is closely watching providers’ accreditation dates. Providers who were accredited in 2007 are now going through their re-accreditation, or will be shortly. Accrediting organizations are coming out to visit providers well in advance (generally about six months out) of their accreditation expiration date. Having your survey six months ahead of expiration allows adequate time to address any deficiencies found on survey, correct those deficiencies and file an accepted plan of correction in advance of your expiration date. Providers who were accredited in 2008 are due for re-accreditation in 2011. NOW is the time to start preparing!

Read more Accreditation Now columns.

Mary Ellen Conway, RN, BSN, is president of Capital Healthcare Group, LLC, Bethesda, Md., which provides health care management expertise in accreditation preparation and survey follow-up, operations assistance, design of quality improvement programs and outcome measures. She can be contacted by phone at 301/896-0193 or through www.capitalhealthcaregroup.com.