Chris Lanaman, Executive Director, Professional Services

Does Pharmacy Charging Have You in a Frenzy?

Pharmacy charging can be one of the most complex forms of charging. For most charges within a hospital, you have an order for a service. Upon completion of that service, a charge is created. There are some nuances like which location the patient is registered to, what status the order is in, or what type of patient the encounter is for, but those charges are often relatively easy for a hospital to build and support. These charges can be described as “true or false” for the charge to occur. However, pharmacy is more complex. Many different factors must be considered when setting up charging for pharmacy. The components listed below must be considered when configuring the build for pharmacy charges.

  • Drug Type: Capsules are usually packaged in certain sizes. Powdered drugs must be mixed or diluted with other pharmacy products or compounded. Liquids need to be measured by the rate the drug is infused.
  • Dispense Dose: You must know the sizes of the manufacturer’s packaging as well as the clinically correct/safe dosage to be dispensed to a patient.
  • Duration: An order for a pharmacy product might be for an extended period. Often this means more than one dose of that drug is dispensed to the patient over time.
  • Administration: Just because a drug was ordered doesn’t mean it will get dispensed. Just because a drug gets dispensed doesn’t mean the drug was administrated to the patient. Also, if a portion of the drug is given to the patient, the amount not given must be recorded.
  • Price: How much is the product markup over the average wholesale price? How much needs to be ordered to keep the shelves stocked?
  • Manufacturers: Which drugs are currently being manufactured and which are no longer being manufactured?
  • Healthcare Common Procedure Coding System (HCPCS): You must have identifiers for each drug.
  • Quantity Conversion Factor (QCF): QCFs are used to comply with the units of measure outlined by the Centers for Medicare & Medicaid Services.
    You must validate that the correct unit of measure matches each HCPCS from Multum (Cerner’s Drug Database solution).

Additional factors such as patient location and encounter type contribute to generating a charge. Often, a charge services employee must rely on the pharmacy team to know how to build out the pharmacy drugs in the system before they can set up the “linking” of the Millennium charging parts of the build. Pharmacy charges do not rely on the order’s status for when it should create a charge, mainly because pharmacy charges get created when the drug is dispensed, administrated, or both, which allows a single pharmacy drug to have different types and ranges of charges. Most organizations forget that this flexibility of pharmacy drugs requires a lot of maintenance to ensure the pharmacy charges continue to happen.

Pharmacy involves cooperation between the revenue integrity team and the pharmacy team to properly maintain the drugs being manufactured, purchased, dispensed, administered, and regulated to create the correct charges and not get denied payments from payors.

Panther’s Formulary Compliance tool provides a real-time view into an organization’s formulary and what is needed for correct charging. The tool also alerts the pharmacy when a drug is becoming obsolete. Since pharmacy charges are one of the largest revenue streams within a hospital organization, it is worth the time and effort to pay extra attention to the build and maintenance of what it takes to create charges.

What does Softek® do?

Softek’s mission is to help hospital systems maximize their investment in Oracle Cerner Millennium®. We do this by providing innovative software solutions and consulting services that can achieve more together than either can alone.

At Softek, our team of innovators and software developers brings expertise beyond the ordinary to every client. Our experts are involved with Oracle Cerner Millennium® hospitals throughout the country, consulting clients so they can optimize system performance and revenue integrity.

Softek delivers a full suite of consulting services and software solutions to assess and optimize EMR system performance, including revenue cycle integrity and patient accounting.

Softek was awarded 2021 Best in KLAS for Revenue Cycle Optimization.

Let’s talk about how you can get the most out of your Oracle Cerner Millennium® system.